Wholesale giant Metro AG now expects sales to decline by between 0.5% and 3.5% in its current financial year, ahead of the group's previous forecast of a decline of between 3% and 6%.
The group raised its outlook for the year on the back of what it said was a 'better than expected business development since the easing of restrictions', while dedicated operational procedures to support businesses during the re-start phase has also led to 'continuous market share gains'.
It also expects EBITDA for the full year to be positive, coming in at between €50 million and €75 million, ahead of a previously-anticipated decline of between €50 million and €175 million.
Metro's Third-Quarter Sales
Citing a 'hospitality comeback', Metro reported sales growth of 12.2% in the third quarter of its financial year, to €6.2 billion. Adjusted for currency effects, sales were up 15.4%. EBITDA nearly doubled to €325 million in the period.
HoReCa sales in the third quarter were up 57%, driven by the widespread opening of hospitality businesses, with Germany, France, Italy and Spain performing ahead of the market average.
"The positive sales trend has continued in July as well," commented Dr Steffen Greubel, CEO of Metro AG. ”Our investments in digitalisation, the multi-channel approach and our customer centricity in these challenging times have led to us gaining in trust.
"Also, the fact that we place emphasis on our broad product range, high availability, and uncompromising quality, both in stores and delivery, is currently paying off and will be further reinforced in the future."
In Germany, sales in local currency were down 3.6% in the quarter, however Western Europe sales (excluding Germany) rose by 34.1%, and Eastern Europe (excluding Russia) rose by 13.2%. Asia was up 10.7%.
Metro said that currency-adjusted sales to HoReCa customers grew by 57% in the third quarter of its financial year, exceeding pre-pandemic levels for the first time since June and continuing to develop positively in July.
Full-Year Outlook
Metro, which recently announced a sale and leaseback agreement for its Lisbon location, added that its full-year outlook is based on the assumption that exchange rates will remain stable, and that there will be no further adjustments to its portfolio.
A partial re-introduction of restrictions would mean that the business reports sales and profits at the lower end of its forecast spectrum, 'considering the still high level of uncertainty and volatility regarding the further development of the pandemic,' it noted.
Metro is also seeking to improve its sustainability footprint, recently announcing a partnership with Plastic Bank on a major waste collection initiative.
© 2021 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more Retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.
