Metro net profit increases, but outlook gloomy

FRANKFURT, Germany - German retailer Metro AG said Thursday it made a net profit of 214 million euros ($282.5 million) in the third quarter, helped by favorable currency swings and strong sales in Eastern Europe and Asia — but warned that the global economic gloom could hurt its business.

The result compares to a loss of 40 million euros a year earlier. The improvement was the result of factors including currency effects in last year's third quarter.

Sales increased 6.5 percent to 16.3 billion euros ($21.52 billion) from 15.3 billion euros last year.

However, "all in all, it can be assumed that the risks for the short- and medium-term development of the retail sector, and consequently for the Metro Group, have increased," the company said in a statement.

Duesseldorf-based Metro said it was sticking to its target of sales growth of more than 6 percent for the full year.

It said pretax earnings would grow by between 6 and 8 percent from last year's 2.1 billion euros.

Metro's businesses include electronics chains Saturn and MediaMarkt, Germany's Galeria Kaufhof department stories and Metro Cash and Carry wholesale supermarkets.

Metro said its sales in Germany were up 2.4 percent in the first quarter, and sales elsewhere in western Europe also increased.

Eastern Europe saw an 18 percent sales increase, while other international sales climbed by 10 percent — with Vietnam, India and China recording strong growth.

Shares of Metro were up 6 percent at 23.20 euros ($30.62) in Frankfurt trading.

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On the Net:

http://www.metrogroup.de

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