German retailer Tengelmann has seen full year net sales decline 6.9%, dropping to EUR18.9bn (US$25.33nm), after a poor performance from the group’s US business.
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Currency adjusted net turnover dropped 5.3%, the company revealed in its annual report.
“The decline is attributable exclusively to the A&P division,” Tengelmann said.
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A&P sales were down 15.7% year-on-year as the group looked to integrate the recently acquired Pathmark stores and refocus activity on the core north eastern region through the disposal of outlets in the Midwest and New Orleans.
Net sales in Europe rose 3.8%, or 4.7% with the impact of currency exchange stripped out, the privately owned retailer stated.
Looking to the coming year Tengelmann warned that the financial crisis is likely to result in falling consumer spending, particularly in its home market.
“In the coming years our enterprise will continue to face considerable challenges. At the same time however, the momentum of change is yielding new and attractive business opportunities,” Tengelmann said.
The group indicated that it will push ahead with its plan to establish a joint venture between its Plus chain and Edika’s discount supermarket business Netto at the beginning of next yet.
It also intends to partially divest its Plus supermarket operations outside of Germany, keeping only operations in Austria, Romania and Bulgaria.
