(Yicai Global) April 17 -- Chinese retail giant Suning.Com raised its expected loss for last year to as much as CNY16.5 billion (USD2.4 billion), citing factors such as increased liquidity pressure and a more than CNY4.1 billion (USD596.3 million) impairment loss at its Carrefour China unit.

The net loss was likely between CNY15.5 billion and CNY16.5 billion (USD2.3 billion and USD2.4 billion) in the 12 months ended Dec. 31, Suning said in a statement on April 14. That is higher than the CNY9.5 billion to CNY11.5 billion it predicted in January, but less than its CNY43.3 billion loss in 2021.

Suning’s shares [SHE: 002024] ended today unchanged at CNY2.11 (31 US cents) apiece.

Carrefour China, the supermarket chain majority owned by Suning, is expected to have had an impairment loss on assets of more than CNY4.1 billion last year, according to its Nanjing-based parent company.

Sales declined and margins narrowed at Carrefour China due to a number of factors, including the external environment, slowing consumer demand, and price competition from community group buying, Suning said. Earnings were also impacted by public opinion, liquidity pressure, and blocked supply chain relationships, it noted.

Carrefour China closed stores in many Chinese cities last year, dropping to 151 outlets as of Sept. 30 from 205 at the end of 2021, Suning said in an earlier earnings report. The supermarket and hypermarket chain operator also had to rebut several bankruptcy rumors after product shortages and restricted gift card use at various locations.

The net loss at Carrefour China widened 3,190 percent last month from a year earlier, while revenue jumped 65 percent, Suning noted. In comparison, the loss rose 13.4 percent in February from a year ago, and revenue fell 65 percent.

Carrefour China remains a key part of Suning's business, the parent company stressed. Its operations will be systematically improved using a series of measures, including focusing on advantageous core cities, closing loss-making outlets quicker, and accelerating the integrated operations of Carrefour China stores and Suning's white goods business, it added.

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 Suning for CNY4.8 billion (USD699 million at the time) and provided it with a shareholder loan as operating funds.

Editor: Martin Kadiev