Metro Group has warned there are increased risks over whether it is able to hit its annual EBIT target.

The German retail giant, in its third quarter profits announced today (3 November), said that uncertainty from the European debt crisis and weakening economic growth could affect its 10% forecast.

However, even in the faltering economic climate, Metro is still forecasting at least 5% EBIT growth.

For its third-quarter, Metro posted EBIT before special items of EUR6.1m (US$8.4m), jumping 37.9% on the same period last year. Earnings climbed across the business, apart from department store chain Galeria Kaufhof. Sales were down 2% across the business, slumping to EUR16bn for the three month period.

This was due to consumers in Western Europe reluctance to spend, negative currency effects in Eastern Europe and store closures, as well as the phasing out of unprofitable product categories at Metro Cash & Carry and Galeria Kaufhof, the company said.

Net profit for the third-quarter before special items was EUR251m, up 31.8% from the third quarter last year.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

For the nine months to September, EBIT before special items was EUR1.07bn, compared to EUR915m the year before. EBIT adjusted for special items was EUR972m, up from EUR794m last year.

From January to September, the retailer posted sales of EUR47.2bn, down 0.6%. Sales were down 1.3% in Germany and down 2.6% in Western Europe. However, sales were up 1% in Eastern Europe and up 11.4% in Asia and Africa.

However, Metro said it increased its earnings despite the “challenging” trading environment. 

Metro CEO Dr Eckhard Cordes said: “We again significantly increased our earnings despite a challenging macroeconomic environment. This attests to the economic strength of Metro Group.”

Net profit for the nine months before special items reached EUR334m, up from EUR318m in same period in 2010. Adjusted net profit before special items was EUR266m, up from EUR229m the year before.