Tuesday November 3, 10:01 AM
German retailer Metro reports stable profits
FRANKFURT (AFP) - The German retailer Metro (Xetra: 725750 - news) on Tuesday reported stable profits in the third quarter but declined to give an outlook for the rest of the year after a survey showed falling consumer confidence in Germany.
Metro said net profit came to 357 million euros (527 million dollars), down just 1.1 percent from the same period a year earlier.
That represented "a clear improvement in the trend," a company statement said, and beat the expectations of analysts polled by Dow Jones Newswires who had given an average forecast of 333 million euros.
Sales were 4.6 percent lower at 15.6 billion euros however, mainly owing to unfavourable foreign exchange effects with eastern European countries, where the group has a strong presence.
Metro makes more than 60 percent of its sales outside Germany.
Within Germany meanwhile, consumer sentiment has fallen for the first time since September 2008 owing to rising petrol prices and unemployment, the latest poll by the GfK economic research institute showed last week.
But Metro chief executive Eckhard Cordes told a press conference that a cost-cutting programme that aims to save 1.5 billion euros by 2012 "had shown initial signs of progress" and contributed to the better than expected profit.
He gave no guidance however regarding the fourth quarter of 2009, which includes the group's crucial holiday shopping period.
"It is impossible to give a reliable forecast," Cordes said.
The Metro CEO nonetheless added that he "was comfortable" with analysts forecasts for a group operating profit of around 1.93 billion euros for 2009.
Metro shares showed a gain of 2.40 percent to 38.4 euros in morning trading on the Frankfurt stock exchange, while the DAX index (Xetra: news) of leading shares was 1.40 percent lower overall.
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