German retailer Metro said today (21 March) that its profit nearly doubled in the latest fiscal year, boosted by the purchase of Wal-Mart’s German stores and strong international sales growth.
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Metro said annual profit increased to EUR1.06bn (US$1.41bn) during the period, with sales rising by 7.5% to EUR59.88bn. The operator of Metro Cash & Carry, Real hypermarkets and consumer-electronics groups Medis Markt and Saturn, said operating profit rose 14.1% to EUR1.89bn.
In July, Metro agreed to buy Wal-Mart’s German stores in a EUR651m deal. Metro has since integrated those stores into its Real network. Although the former Wal-Mart business lost money for its new owner, accounting adjustments led to a EUR44m benefit.
German sales, when adjusted to remove the impact of the Wal-Mart acquisition, increased 0.3%. Internationally, excluding the impact of the company’s acquisition of Geant in Poland, sales were up a stronger 12%. The company received two-thirds of its earnings and 56% of its sales outside of Germany.
Metro has been aggressively expanding in Eastern Europe and Asia, and plans to open its first Metro Cash and Carry store in Pakistan and first Media Markt store in Turkey in 2007.
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By GlobalDataProfits were enhanced by the sale of Metro’s stake in home-improvement retailer Praktiker, which generated proceeds of EUR484m.
