BERLIN – Operating earnings (EBIT) at the Metro Group plunged almost 70 percent and sales slipped 2.5 percent in the first quarter.
The net loss came in at 77 million euros or $100.7 million, versus profits of 8 million euros or $10.5 million the year previously.
The German retail giant, which is comprised of the core Cash & Carry division, Galeria Kaufhof department stores as well as electronics chains, supermarkets and hypermarkets, said both earnings and sales were hit by negative currency impact, restructuring costs and calendar shifts, including the move of the Easter business into the second quarter and one less selling day than in the leap year 2008.
Group EBIT reached 51 million euros or $66.7 million compared to 166 million euros or $217.1 million the year previously. Dollar figures are converted at an average exchange rate for the quarter.
Including 33 million euros or $43.2 million in special items relating to the group’s value and efficiency program, adjusted EBIT for the quarter reached 84 million euros or $109.9 million.
Group sales reached 15.2 billion euros or $19.9 billion. Adjusted for calendar effects and currency impact, group sales rose 3.6 percent in the quarter. Domestic sales were flat, while exchange rate fluctuations pressured growth markets in Eastern Europe, where sales slipped 10 percent.
At the Metro Cash & Carry stores, sales dropped 1.8 percent to 7 billion euros or $9.2 billion. Adjusted for currency effects, sales declined 6.4 percent. EBIT came in at nil, compared to 70 million euros or $91.6 million in 2008. Optimisation measures amounted to 11 million euros or $14.4 million in the quarter.
The Galeria Kaufhof department stores also saw sales and EBIT waver in the quarter. Both reported and currency adjusted sales at the 141 door chain fell 3.8 percent to 792 million euros or $1.04 billion, while the operating loss was 47 million euros or $61.5 million euros, compared to minus 20 million euros or minus $26.2 million in the first quarter of 2008. The group noted that department stores in Germany “usually only achieve a positive EBIT in the second half of the year.”
Moreover, the 2,100-door group, which employs about 300,000 in 32 countries, pointed to a positive business development in April. Metro described the Easter business as “gratifying,” and said both sales and earnings in April showed a “noticeable upward trend.” According to preliminary figures, EBIT in April was up from the previous year.