METRO GROUP increases sales 2012 and confirms EBIT guidance

• Sales of METRO GROUP grew by 2.3% adjusted for the disposals of Makro UK and Saturn France
• EBIT guidance for 2012 confirmed: EBIT before special items of around € 2 billion expected
• Q4 sales of Media-Saturn in Germany grew by 3% like for like – online sales more than doubled
• METRO GROUP will not continue engagement of Media Markt in China
• Successful conclusion of real estate transaction in France

31-1-2013 — /europawire.eu/ — According to preliminary figures, METRO GROUP increased sales by 1.2% to€ 66.7 billion in financial year 2012 (0.8% in local currency). Adjusted for the disposals of Makro UK and Saturn France, sales rose by 2.3%. “Despite tougher market conditions, especially in Southern Europe, we succeeded in increasing sales in the fourth quarter. Our goal is to continuously become more attractive for our customers and therefore increase our competitiveness. Here, we already made significant progress in 2012, in particular also owing to the extraordinary commitment of our employees in this challenging year”, said Olaf Koch, Chairman of the Management Board of METRO AG. “The driving forces behind our customer-orientated business realignment have been the successful expansion of our delivery and multichannel activities, our product range and price positioning improvements as well as the further strengthening of our own brands. Upon this foundation, we shall continue to build”.

Financial year 2012 was marked by rising unemployment in Europe and increased measures toward consolidation among European governments to curb the sovereign debt crisis. The resulting consumer reticence had a negative impact on our business development. Taking into account these factors, the sales development was satisfactory, both in the full year and in Q4. Sales in all regions except Western Europe (excluding Germany) increased. “We succeeded in gaining shares in many markets”, said Koch. “The most impressive development was that of Media-Saturn in Germany: Investments in the attractiveness of the store-based business together with the consequent development of the Internet presence led to the very positive sales momentum in the course of the year.”

METRO GROUP confirmed its 2012 EBIT before special items forecast of around€2 billion. This figure includes a success-fully concluded real estate transaction in France in Q4 2012. METRO GROUP continues to expect cash flow to improve considerably. As a result, net debt is expected to decline.

In addition, METRO GROUP also decided to discontinue the business operations of Media-Saturn in China and set up the corresponding provisions in the balance sheet. This decision was prompted by the experiences and forecasts deriving from the two-year test phase that expired at the end of December. The way forward will now be determined together with the joint venture partner Foxconn Technology Group, with whom METRO GROUP jointly operates Media Markt China. “After carefully analysing all alternatives, we have decided not to continue our business activities”, said Koch. “In order to keep METRO GROUP on target for success, it is essential for us to concentrate on those business units and markets where we can clearly sharpen our profile and build up a strong market position. We will further intensify our successful commitment to METRO Cash & Carry in China. The country is key and a promising market with good future prospects for our wholesale business”.

Sales development in financial year 2012
In Q4 2012, sales grew by 0.5% to €19.4 billion (in local currency: -0.5%).Excluding Makro UK, sales increased by 1.8%. Following a subdued start to the Christmas business, sales momentum increased significantly at the end of the year despite the negative calendar effect. Overall, Christmas trading was satisfactory, especially at Media-Saturn. In financial year 2012 METRO GROUP opened 97 stores in 17 countries, 57 thereof in Q4 2012.

¹ Since Q1 2012, METRO GROUP reports sales revenues from so-called commission transactions only in the amount of the commission it receives in its role as an agent. The goal is to achieve a better comparability with other retail companies, especially with a view to the EBIT margin. The gross profit and EBIT are not affected by the changed reporting. To ensure comparability, the sales proceeds for the full year 2011 were adjusted by € 0.8 billion.

METRO Cash & Carry
In financial year 2012, sales at METRO Cash & Carry grew by 1.6% to €31.6 billion(in local currency: +0.7%). However, the exit from the UK market had a significantly negative impact on sales growth compared to the previous year’s period. Adjusted for the disposal of the 30 Makro stores in the United Kingdom sales grew by 3.2%, in Q4 even by 3.4%. The delivery business continued growing dynamically and amounted to €2.2 billion (2011: €1.6 billion).

In Germany, sales in financial year 2012 decreased, particularly due to the optimisation of the store base (Q4 2011: 10 closures) as well as weaker non-food sales.

Sales in Western Europe were negatively impacted by the disposal of Makro UK, in particular. The difficult economic environment in Southern Europe also led to sales decreases. This mainly affected the non-food business. This trend continued in Q4.

Sales in Eastern Europe increased significantly in the financial year. The development in Russia, in particular, was very positive. Momentum increased further in Q4 with positive currency effects also becoming apparent.

In Asia, the strong growth trend continued once again in financial year 2012. All countries recorded double-digit sales growth. The sales development in Q4 followed the positive trend in the previous quarter. With the exception of Vietnam, like-for-like sales increased significantly in all countries – by double-digit figures in some cases. In China 12 stores were opened. METRO Cash & Carry opened the highest number of stores in one year in one country in its entire history.

Real
In financial year 2012, sales at Real were on par with the previous year’s figure, amounting to €11.0 billion (in local currency: +0.1%). Sales in Q4 increased by 0.6% to €3.1 billion (in local currency: -0.3%). Sales in Germany were slightly up year-on-year despite store disposals. This trend increased in Q4 and Real profited from an higher demand for food in the Christmas business.