The delayed reopening of hospitality businesses has prompted wholesale giant Metro to revise its guidance for the coming year.
The group said that according to preliminary figures for the first half of its 2020/21 financial year, total sales in local currencies were down 11.5% on the previous year, while EBITDA was down by around €120 million.
In updating its guidance, Metro said that the 'decisive exogenous factor is the continuous prolongation and a high volatility of regulatory measures related to COVID-19. These measures continue to significantly restrict public life in many of the Metro countries.'
It said it had originally expected hospitality businesses to start to reopen from April at the latest, which now 'appears no longer realistic on a broad scale before June'.
Business Turnaround
The company's management board, however, said that it is 'still convinced of the fast and substantial recovery of the hospitality and tourism industry upon release of the governmental restrictions and has seen evidence of this in the countries where hospitality businesses have been reopened partially or in full.'
Based on the likelihood of hospitality reopening taking place broadly between June and August, Metro said that it now expects sales for the full year to decline by around 3% to 6% on the previous year.
Adjusted EBITDA, meanwhile, is likely to decline by between €50 million and €175 million compared to the previous financial year.
Hospitality Business
'The sensitivity of sales and earnings to the duration and severity of governmental restrictions is the highest for hospitality driven regions, esp. in the segment Western Europe,' it said. 'In contrast, the segments Russia and Asia are expected to perform better than the group.'
Metro will publish its first-half report on 4 May, in which it expects its sales performance to be in line with expectations.
'Considering the strong financial profile, the proven competitive position and the comprehensive digital footprint, Metro is well positioned to benefit from the upcoming recovery,' it added.
Elsewhere, the group recently called time on its involvement in the Horizon purchasing venture, alongside a number of other European operators.
© 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.
