Barclays European Food Retail Equity Research has said that wholesaler Metro AG is likely to post EBIT of €107 million in its second quarter, driven by an approximately €70 million boost as a result of a recent property disposal.
Metro’s EBIT for the second quarter of 2016 stood at €38 million. The group announces its second quarter results on 31 May.
However, Barclays suggests that like for like sales in the group’s Cash & Carry division will decline 1.2%, due to a negative calendar impact.
Resilient
‘We believe the group's performance in Russia remained resilient despite the soft consumer demand and intense competition, while performance in Germany is improving very slowly,’ Barclays said in a statement.
Its Media-Saturn business is likely to see like-for-like sales increase by 0.6%, Barclays forecast, however the group is likely to have experienced ‘tough’ trading activity in Russia and some Western European markets.
Commenting on the group’s planned demerger, Barclays said that it remains, ‘confident that the spin-off will have operating benefits for Metro (stronger focus on FCF generation, more active and pragmatic management of the country portfolio).
‘We also expect the spin-off will help to reduce the conglomerate discount that mainly penalises its Cash & Carry division.’
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
