German retailer Metro Group reported worse-than-expected Q1 results, which it attributed to negative currency effects and poor performance in Russia.
Pre-tax profits were down 7 per cent from €891 million to €828 million, a figure that was hit by currency fluctuations. Overall sales were down slightly from €17.3 billion to €17.1 billion.
Despite this, however, like-for-like sales increased by 0.1 per cent year on year. The group also reduced its debt from €1.5 billion to €0.1 billion - the lowest level in its history.
Sales in Germany alone were up, aided by a successful Christmas period, but international sales dropped, which Olaf Koch, chairman of the management board, said was due to factors beyond its control.
"The volatile exchange rates and the previous year’s pull-forward effects on sales in Russia had an negative impact on earnings. For the full year, I remain confident on account of the positive developments in many countries that we will meet our sales and earnings targets for Metro Group," said Koch.
In a statement, the group said it expects "a slight increase in overall sales, despite the persistently challenging economic environment" and will reach its profit targets for the year.
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by John Golden. To subscribe to ESM: The European Supermarket Magazine, click here.
