BERLIN — Portfolio changes, efficiency measures and currency effects negatively impacted earnings and dampened nominal sales at the Metro Group in the third quarter of its 2013-14 fiscal year.
For the three months ended June 30, the German cash & carry, department store, hypermarket and electronics retail group booked a net loss of 63 million euros, or $86.4 million euros, compared with a profit of 33 million euros, or $43.1 million, in the same prior-year period.
Dollar figures are converted at average exchange for the period to which they refer.
A Metro spokeswoman said the loss was generated by special effects of 83 million euros, or $113.8 million, related to portfolio optimization at the Metro Cash & Carry and Real divisions, as well as efficiency measures at Media Saturn. Without such special effects, net profit for the third quarter surged 82 percent to 103 million euros, or $145.4 million, compared with 19 million, or $24.8 million, in the prior-year period.
Operative earnings for the quarter were flat. Before special items, earnings before interest and taxes remained at 276 million euros, or $378.5 million.
Sales slipped 2.7 percent to 14.86 billion euros, or $20.38 billion, but the group noted like-for-like revenues rose 1.7 percent, supported by a shift in the Easter business.
The core Metro Cash & Carry division posted nominal sales down 2.2 percent to 7.55 billion euros, or $10.35 billion. Like for-like sales grew 2 percent, with “very positive” performance in Germany, Eastern Europe and Asia, the group said. EBIT before special items was down 5 percent to 281 million euros, or $385.4 million, primarily impacted by currency effects.
Galeria Kaufhof, which operates 122 department stores in Germany and 15 in Belgium, registered a 2.2 percent sales gain in the quarter to 694 million euros, or $951.8 million. Sales in Germany advanced 2.6 percent. EBIT before special items was down 15.4 percent, which Metro said could “mainly be attributed to expenditures for the company’s online presence.”
In the first nine months of fiscal 2013-14, sales generated by the group’s galeria.de and sportarena.de online shops rose by more than 70 percent to reach 51 million euros, or $69.7 million.
Metro confirmed its guidance for the full 2013-14 financial year. Sales in local currency are expected to rise slightly, and on a like-for-like basis, the group said it anticipates improvement following last year’s 1.3 percent decline, with revenues roughly reaching the previous year’s level. Earnings will be impacted by announced changes in the group’s real-estate strategy and portfolio changes, but Metro said it expects to meet its EBIT before special items target of around 1.75 billion euros, or $2.34 billion at current exchange, provided currency rates remain constant.