Metro AG has posted a 1.0% increase in like-for-like sales in the first quarter of its financial year, with total sales rising by 2.2% to €7.5 billion due to positive currency effects.
While like-for-like growth in Eastern Europe (+5.0%) and Asia (+3.2%) was 'strong', the group said, its home market of Germany saw a marginal like-for-like decline of 0.4%, due to a regulation change relating to tobacco.
Western Europe (excluding Germany) was up 0.5%.
Problems continued at Metro's Russian operation, which saw like-for-like sales decline by 5.3%, however this was an improvement on the 6.3% decline the group reported in the fourth quarter of last year.
'Difficult Conditions'
"In the first quarter 2019/20, Metro continued to grow in the majority of the regions despite difficult macroeconomic and political conditions in some countries, for example the national general strikes in France," commented Olaf Koch.
No sales figures were given for the Real hypermarket business or for Metro China, however Koch noted that the sales process for both was "progressing according to plan".
As of 31 December, Metro AG's portfolio consists of 679 stores, three more than at the same time the previous year. The group opened one new outlet in the quarter, in Ukraine.
Analyst View
Commenting on its performance, analyst Bruno Monteyne of Bernstein Research said, "Management did however confirm their FY outlook, so we would imagine some of the weakness on the topline will unwind later in the year.
"They are likely expecting an improvement in Russia to boost H2. As Russia has now taken much longer to turnaround than initial indication, we would be cautious to put too much faith in that. It is also worth bearing in mind that FY guidance is consistent with EPS halving, therefore this is a weak start to a low-profitability year."
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