Metro Group Q2 sales down 3.8%

Metro Group reported a 3.8% drop in second quarter sales, which it attributed to negative foreign exchange effects in Eastern Europe. Q2 sales fell to EUR15.3 billion (USD21.4 billion). However, the company managed to eke out a slight net profit of EUR48 million (USD67.3 million).

Group sales in the first half-year reached EUR30.5 billion (USD42.7 billion), a 3.2% decrease on the same period a year earlier. Adjusted for currency effects, however, sales rose by 0.5%. The company achieved a robust growth in local currency, especially in Eastern Europe. Eckhard Cordes, CEO of Metro Group, announced a significant expansion of the store network in the second half of the year. After opening 30 new stores in the first half of 2009, the company is planning to extend its international network by roughly 50 other stores in the second half. Investments will focus on growth regions in Eastern Europe and Asia. Two market entries were postponed, with the Kazakhstan entry, originally planned for summer 2009, was postponed to autumn 2009 and entry into Egypt, originally planned for late 2009, will now take place in 2010.

In Germany, H1 sales grew 0.1% to EUR12.4 billion (USD17.4 billion). This was particularly down to like-for-like sales growth generated by Media Markt and Saturn during the first six months and by Real in the second quarter. Significant currency effects in the first half impacted sales trends in the international business. Excluding currency effects sales rose 0.8%. In euro, however, sales dropped 5.3% to EUR18.2 billion (USD25.5 billion). Due to exchange rate fluctuations the international share of sales receded from 60.8% to 59.5%. In Western Europe (excluding Germany), H1 sales declined 1.9% to EUR9.6 billion (USD13.5 billion). Excluding currency effects, sales dropped 1.2%. Media Markt and Saturn boosted sales, but could only partially compensate for the drop in sales at Metro Cash & Carry. Adjusted for exchange rates, H1 sales in Eastern Europe (Planet Retail definition Central and Eastern Europe) grew 3.6%. Due to strong currency effects, however, sales in euro declined 11.6% to EUR7.3 billion (USD10.2 billion). In the Asia/Africa region, H1 sales grew 12.7% to EUR1.2 billion (USD1.7 billion). Adjusted for currency effects, sales came in slightly above the prior-year level. All Asian countries reported a distinct growth in sales also in the second quarter.

Compared with the same period a year earlier, EBIT before special items dropped from EUR493 million (USD721.4 million) to EUR392 million (USD549.3 million) and includes negative currency effects. The implementation of the efficiency and value-enhancing programme ‘Shape 2012’ is fully on schedule and the decentralised organisational structure has been established.

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