Metro Adjusts FY Outlook

(RTTNews) - Metro AG now expects the EBITDA, exchange-rate adjusted and excluding earnings contributions from real estate transactions, to increase slightly - instead of by about 10% - in the financial year 2017/18 as compared to last year's result of 1.436 billion euros.

With regard to overall sales Metro AG now expects a growth rate of minimum 0.5% in the financial year 2017/18 instead of a growth rate of minimum 1.1%, both figures exchange-rate adjusted.

Metro stated that the reduced expectations are mainly based on the fact that the business of METRO AG in Russia is currently developing less favorably than expected. METRO AG had expected a significant improvement of the sales development in Russia for the second half-year. Instead, the Management Board now - also because of the further deteriorating geopolitical situation - expects sales in the second half-year to stay behind expectations. Furthermore the repositioning of the business will incur higher additional cost in the second half-year than previously expected. Overall, this leads to a decrease of the expected earnings contribution of METRO Russia.

In addition to that, the tariff negotiations with the ver.di trade union on a competitive remuneration structure at Real have ended without an agreement. Although a viable alternative solution has been found and is being implemented, this fact will in the short and medium term, and therefore also in the third and fourth quarter, put a strain on earnings.

The outlook for like-for-like sales is confirmed. The Management Board of METRO AG expects it to slightly surpass the 0.5% growth delivered in the reporting year 2016/17. METRO Wholesale is expected to make a significant contribution to this growth.

METRO said it will publish its half-year financial report as scheduled on May 15, 2018. On the basis of preliminary data METRO AG expects overall sales of 18.560 billion euros, a like-for-like sales growth of 1.3% and an EBITDA , excluding earnings contributions from real estate transactions, of 760 million euros for the first half-year.