A small startup launched in 1986 with limited resources, Label’Vie has now become the benchmark in its sector. Its founders, Zouhair Bennani and Rachid Hadni, have lived through the ages with a strong desire to grow. Nearly 40 years later, they are still not satisfied. They have divided up the tasks, as on the first day, to continue to widen the gap with the competition. Zouhair Bennani stepped down as CEO in 2022 in favor of his companion, Rachid Hadni, who now chairs the Board of Directors. Bennani focuses on strategy, while Hadni plays the score, surrounded by a strong, experienced team with a great sense of belonging.
The group ended 2023 with a record turnover of more than 15.8 billion dirhams, representing almost triple its level of 10 years ago, and an ROE above 16%. Indicators that the group wishes to significantly increase as part of its new business plan presented to investors on June 25. “Since our group has been listed on the stock market, we have always done what we promised. From now on, we want to offer an accessible, modern store adapted to each citizen by accelerating our local development plan, but also by exploring international growth opportunities,” explains Rachid Hadni.
The group, which has made multi-format its real strength by offering a type of store for each category of customer, now aims to go from 179 stores in 2023 to 953 in 2028 by focusing on formats with high potential: Atacadao, Supeco and Carrefour Express. Formats that consume less Capex and which are aimed at a price-sensitive clientele, which the group can comfortably target thanks to its negotiating power and its efficient purchasing center.
Label’Vie wants to export internationally
One of the major new features announced, and for which investors have had high expectations for several years, is the international opening. Zouhair Bennani recognizes that this growth lever was not activated as the minority shareholders wanted. He explains this by the fear of degrading the group’s profitability by making it take its first experiments internationally. The initial decision was to make investments abroad, in Ivory Coast in particular or in France in partnership with Carrefour, through the Best Financière holding company, parent company of Label’Vie. But, according to him, the experience curve now makes it possible to switch to a strategy where stores outside the Kingdom are supported by Label’Vie. Preferring to remain cautious and not make premature announcements, neither Zouhair Bennani nor the General Director of Label’Vie, Naoual Ben Amar, wished to venture into any operation, contenting themselves with explaining that concrete projects are studied. The market is speculating on a potential direct sale of Best Financière’s foreign holdings to Label’Vie. But for management, it remains just one option among others.
Double turnover by 2028
In figures, Label’Vie’s business plan would double turnover by 2028 to reach 28 billion dirhams. This is the promise of management, which predicts a stable EBITDA margin rate at 9.3%, explained by a format mix that would pull prices down, offset by greater operational efficiency and economies of scale. Supeco, which currently represents 1% of sales volume, should represent, according to CFO Amine Bennis, around 7% of sales volume in 2028. Carrefour Express should represent 9% of volumes compared to 5% currently, while Atacadao, the real workhorse of the new strategy, would increase from a weight of 38% to 41% of volumes sold through 36 stores for this brand, compared to 13 currently.
7 billion dirhams of investments over 5 years
To achieve these objectives, the group plans to invest 7 billion dirhams over the next 5 years. “80% of the financing would come from our self-financing capacity,” explains Amine Bennis, who points out that the group also benefits from the cash flow coming from its interests in two giant real estate companies, Aradei Capital and Terramis. According to the manager, this business plan can be financed without even diluting itself in these two real estate companies, which represent an additional security lever.
By the time of the plan, Label’Vie version 2028 should have a debt ratio of 44.4% compared to 53.1%, a financial result close to 40 million dirhams (compared to a result that is barely balanced today) and a dividend distribution rate of 58% compared to 53% currently, enough to maintain a good balance between financing growth and shareholder remuneration.
