(Yicai Global) Jan. 10 -- Carrefour China has reportedly rebutted a rumor that the hypermarket chain operator, majority owned by Chinese retail giant Suning.Com, is about to go bankrupt.

Consumers should not believe or spread rumors, the relevant person in charge at Carrefour China was cited as saying by The Paper yesterday. The retailer will continue to cultivate the Chinese market and provide excellent services, the person said.

As well as some empty shelving in Carrefour stores, customers have also noted that their gift cards have been rejected recently, leading to online rumors about the business’ impending demise.

Carrefour’s stores in the Chinese mainland accept WeChat Pay, Alipay, Cloud QuickPass, bank cards, cash, and other payment methods, and most goods can be bought via gift cards, the person claimed. 

Carrefour entered China in 1995 and expanded quickly early on, securing a relatively large market share. But profits began to decline as competition increased. In 2019, the French retailer sold 80 percent of its loss-making China business to Jiangsu-based Suning for CNY4.8 billion (USD699 million at the time).

The retail sector has faced unprecedented challenges in recent years because of the Covid-19 pandemic and other factors, the person said, adding that Carrefour China is transforming and upgrading to deal with these challenges and promote new supply chain models.

With the coordination and support of suppliers, groups, and other parties, the firm’s supply chain is being optimized in an orderly manner, and will continue to provide consumers with richer product choices, the person said.

Carrefour had 151 stores in China as of Sept. 30, after 54 closed in the first three quarters of the year, according to Suning’s financial report released on Nov. 1.

Suning shut some regional stores to improve Carrefour China’s economies of scale. The integration of the 3C (computers, communications, and consumer electronics) business model took advantage of the large number of consumers in stores to increase the income from the highly profitable home appliance business and share fixed costs.

Carrefour China’s net loss widened almost 14 percent to CNY662 million (USD98 million) in the first half of 2022 from a year earlier, Suning’s earnings statement showed. Revenue fell 25 percent to CNY8.9 billion (USD1.3 billion).

Editor: Martin Kadiev