Sales and earnings development

Group sales of METRO GROUP 2014/15
by region

Group sales of METRO GROUP 2014/15 (pie chart)

METRO GROUP’s like-for-like sales grew by 1.5 per cent in financial year 2014/15. Sales in local currency rose by 0.5 per cent. Due to negative currency and portfolio effects, however, reported sales of €59.2 billion were 1.2 per cent lower than in the previous year.

In Germany, like-for-like sales matched the previous year’s level. Sales totalled €22.5 billion, a slight decline of 0.3 per cent compared with the previous year’s figure. This was due to lower sales at METRO Cash & Carry and Real. At Real, store closures had a negative impact on reported sales. In contrast, Media-Saturn posted higher sales.

Like-for-like sales in the international business increased by 2.4 per cent. International sales rose by 1.0 per cent in local currency. Reported sales declined by 1.7 per cent to €36.7 billion. This decline was primarily due to currency effects as well as store disposals and closures.

International sales accounted for 62.0 per cent of total sales (2013/14: 62.4 per cent).

In Western Europe (excluding Germany), like-for-like sales rose by 1.1 per cent. Sales in local currency increased by 0.7 per cent. Reported sales improved by 1.0 per cent to €19.1 billion. This was due largely to positive developments in Italy, Spain and the Netherlands.

Like-for-like sales in Eastern Europe rose markedly by 5.3 per cent. Adjusted for currency effects, sales climbed by 1.7 per cent. Business developments in Russia and Hungary especially contributed to this increase. However, due to negative exchange rate developments and active portfolio measures (Real Eastern Europe and METRO Cash & Carry Greece), reported sales declined by 9.7 per cent to €13.3 billion.

While like-for-like sales in the Asia/Africa region declined slightly by 0.4 per cent overall, the trend in India was positive. Sales in local currency improved by 0.5 per cent. Due to positive currency trends, reported sales rose by 16.1 per cent to €4.3 billion.

In financial year 2014/15, METRO GROUP’s EBIT amounted to €711 million, a decline of €366 million compared with the previous year’s level (2013/14: €1,077 million). However, this figure includes special items amounting to €800 million (2013/14: €454 million). These special items can be broken down into impairment losses on goodwill (particularly at Real Germany, with €446 million), restructuring and efficiency improvement measures amounting to €285 million (essentially planned closures) as well as other special items of €66 million. Portfolio changes produced a net positive special item of €23 million.

In addition, gains from the sale of Galeria Kaufhof resulted in a positive special item of €841 million in discontinued operations.

Special items include transactions that do not regularly recur, such as restructurings or changes to the group portfolio. Reporting before special items better reflects the company’s operating performance and thus renders the earnings presentation more meaningful.

An overview including the reconciliation of special items can be found in the combined management report.

In financial year 2014/15, EBIT before special items at METRO GROUP fell from €1,531 million to €1,511 million. However, this figure includes negative currency effects of €117 million, meaning that METRO GROUP recorded higher EBIT before special items in local currency.

Development of group sales
by sales line and region

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Change in % compared with the previous year’s period

 

 

 

 

 

 

 

 

2013/141
€ million

2014/15
€ million

in €

Currency effects in percentage points

in local currency

like-for-like sales in local currency

1

Adjustment of previous year’s figures due to discontinued operations (see notes to the consolidated financial statements – notes to the group accounting principles and methods)

METRO Cash & Carry

30,513

29,690

−2.7

−2.7

0.0

0.9

Media-Saturn

20,981

21,737

3.6

−1.0

4.6

3.1

Real

8,432

7,735

−8.3

0.0

−8.3

−0.8

Others

10

56

METRO GROUP

59,937

59,219

−1.2

−1.7

0.5

1.5

thereof Germany

22,558

22,490

−0.3

0.0

−0.3

0.1

thereof international

37,379

36,728

−1.7

−2.8

1.0

2.4

Western Europe (excl. Germany)

18,902

19,090

1.0

0.3

0.7

1.1

Eastern Europe

14,755

13,318

−9.7

−11.4

1.7

5.3

Asia/Africa

3,722

4,319

16.1

15.5

0.5

−0.4

Development of group EBIT and EBIT of the sales lines

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EBIT1

 

 

 

€ million

2013/142

2014/15

1

Before special items

2

Adjustment of previous year’s figures due to discontinued operations (see notes to the consolidated financial statements – notes to the group accounting principles and methods)

METRO Cash & Carry

1,125

1,050

Media-Saturn

335

442

Real

81

88

Others

−10

−63

Consolidation

0

−5

METRO GROUP

1,531

1,511

Sales and earnings development of the sales lines

METRO Cash & Carry

Sales of METRO Cash & Carry 2014/15
by region

Sales of METRO Cash & Carry 2014/15 (pie chart)

Like-for-like sales at METRO Cash & Carry rose by 0.9 per cent in financial year 2014/15, with positive sales growth in all quarters. The previous year’s figure was matched in terms of sales in local currency. Due to exchange rate developments – particularly with respect to the Russian rouble – and portfolio changes, reported sales declined by 2.7 per cent to €29.7 billion.

Sales in the delivery business continued their strong momentum and rose by 11.6 per cent in local currency. Reported sales rose by as much as 13.7 per cent to €3.1 billion (2013/14: €2.8 billion). The share of delivery sales in total sales improved to 10.6 per cent.

Like-for-like sales in Germany fell by 1.7 per cent in financial year 2014/15. Reported sales also declined by 1.7 per cent to €4.7 billion. However, the trend improved as the financial year progressed.

In Western Europe (excluding Germany), like-for-like sales retreated by 0.7 per cent. Sales declined in Belgium and the Netherlands, but increased in Italy, Portugal and Spain. Sales also fell by 0.7 per cent in local currency. Reported sales retreated by 2.8 per cent to €10.2 billion (2013/14: €10.5 billion). This is partially due to the withdrawal from Denmark at the end of 2014.

Like-for-like sales in Eastern Europe increased by 4.5 per cent. In spite of the difficult political situation, like-for-like sales in Russia increased, driven partly by inflation. Like-for-like sales also increased in all other Eastern European countries with the exception of Poland and Romania. Sales rose by 3.5 per cent in local currency. Reported sales fell by 9.1 per cent to €10.4 billion due to very negative currency effects and the sale of the Greek business.

Like-for-like sales in Asia/Africa declined slightly by 0.4 per cent, with India and Japan posting higher like-for-like sales. However, sales rose by 0.5 per cent in local currency. Thanks to positive currency effects, reported sales improved by 16.1 per cent to €4.3 billion.

In financial year 2014/15, the international share of sales of METRO Cash & Carry fell slightly from 84.2 per cent to 84.0 per cent as a result of currency effects.

EBIT at METRO Cash & Carry totalled €975 million in financial year 2014/15 (2013/14: €904 million). This figure includes special items totalling €75 million (2013/14: €221 million). These particularly related to restructuring and efficiency improvement measures at, among others, METRO Cash & Carry Germany.

EBIT before special items amounted to €1,050 million (2013/14: €1,125 million). This decline was due largely to negative currency effects in Russia. Adjusted for these effects, earnings before special items improved.

On 30 September 2015, METRO Cash & Carry operated 764 stores in 26 countries. Of these stores, 107 were in Germany, 232 in Western Europe (excluding Germany), 288 in Eastern Europe and 137 in Asia.

Key figures METRO Cash & Carry 2014/15 in year-on-year comparison

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Change in % compared with the previous year’s period

 

 

 

 

 

 

 

 

2013/14
€ million

2014/15
€ million

in €

Currency effects in percentage points

in local currency

like-for-like sales in local currency

1

Before special items

Sales

30,513

29,690

−2.7

−2.7

0.0

0.9

Germany

4,819

4,739

−1.7

0.0

−1.7

−1.7

Western Europe (excl. Germany)

10,547

10,247

−2.8

0.0

−2.8

−0.7

Eastern Europe

11,431

10,392

−9.1

−12.6

3.5

4.5

Asia/Africa

3,716

4,312

16.1

15.5

0.5

−0.4

EBIT1

1,125

1,050

−6.6

EBIT margin (%)1

3.7

3.5

Locations (number)

766

764

Selling space (1,000 m2)

5,576

5,468

Media-Saturn

Sales of Media-Saturn 2014/15
by region

Sales of Media-Saturn 2014/15 (pie chart)

Like-for-like sales of Media-Saturn grew by 3.1 per cent in financial year 2014/15, with positive sales growth in all quarters. Sales in local currency increased by 4.6 per cent, while reported sales rose by 3.6 per cent to €21.7 billion.

Online retail also continued its strong momentum: internet sales climbed by more than 20 per cent to €1.8 billion. As a result, online sales now account for more than 8 per cent of total sales.

Like-for-like sales in Germany increased by 1.6 per cent. Reported sales grew by 2.3 per cent to €10.0 billion. Sales trends during the year were very positive, with the only interruption in summer due to the comparison with the high reference values of the previous year in connection with the 2014 FIFA World Cup.

Customers’ very positive response to the continued dovetailing of sales channels was reflected in a pick-up rate of about 40 per cent for goods purchased online. The online product range was expanded once again. At the end of September 2015, it consisted of more than 150,000 items at mediamarkt.de and about 130,000 at saturn.de. As such, the online selection markedly exceeds the product range available in most Media-Saturn stores.

In Western Europe (excluding Germany), like-for-like sales rose by 3.4 per cent. Particularly Spain stood out due to double-digit sales growth. However, like-for-like sales also developed very favourably in Sweden, the Netherlands and Austria. In Switzerland, the strong Swiss franc dampened domestic demand. As a result, sales also declined at Media-Saturn. Across Western Europe, sales in local currency improved markedly by 5.1 per cent. Reported sales increased by 5.8 per cent to €8.8 billion. METRO GROUP captured additional market share in nearly all countries.

In Eastern Europe, like-for-like sales rose noticeably by 8.4 per cent. Once again, the two countries that stood out with double-digit growth rates were Hungary and Turkey. Measured in local currency, sales rose steeply by 12.3 per cent. Reported sales grew by 1.7 per cent to €2.9 billion. Negative currency effects had a significant negative impact on sales in the region.

The international share of sales rose from 53.3 per cent to 53.9 per cent in financial year 2014/15.

EBIT at Media-Saturn climbed to €336 million (2013/14: €244 million). This figure includes special items totalling €107 million (2013/14: €91 million). These items involved a large number of restructuring and efficiency improvement measures.

EBIT before special items increased noticeably from €335 million to €442 million. A better sales mix and a higher share of services as well as continually efficient cost management had a positive effect here. Stronger consumption in Russia in anticipation of continued depreciation of the Russian rouble provided for an additional boost in the Christmas quarter.

On 30 September 2015, Media-Saturn had 1,007 consumer electronics stores in 15 countries, including 417 in Germany, 372 in Western Europe (excluding Germany) and 218 in Eastern Europe.

Key figures Media-Saturn 2014/15 in year-on-year comparison

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Change in % compared with the previous year’s period

 

 

 

 

 

 

 

 

2013/14
€ million

2014/15
€ million

in €

Currency effects in percentage points

in local currency

like-for-like sales in local currency

1

Before special items

Sales

20,981

21,737

3.6

−1.0

4.6

3.1

Germany

9,795

10,016

2.3

0.0

2.3

1.6

Western Europe (excl. Germany)

8,356

8,843

5.8

0.7

5.1

3.4

Eastern Europe

2,831

2,878

1.7

−10.6

12.3

8.4

EBIT1

335

442

32.2

EBIT margin (%)1

1.6

2.0

Locations (number)

986

1,007

Selling space (1,000 m2)

3,070

3,034

Real

Sales at Real declined by 8.3 per cent to €7.7 billion in financial year 2014/15 as parts of the sold European business had still contributed to sales in financial year 2013/14.

Like-for-like sales of Real in Germany fell by 0.8 per cent in financial year 2014/15. Due mostly to store closures, reported sales retreated by 2.6 per cent to €7.7 billion. Sales were particularly dampened by persistently intense competition in food retail. The sales volume and customer traffic were positively impacted by the store modernisation programme based on the successful renovation of the store in Essen, which has now been implemented at 107 sites.

EBIT at Real totalled €–441 million in financial year 2014/15 (2013/14: €19 million). This included special items of €529 million relating in particular to non-cash impairment losses on goodwill and store closures.

EBIT before special items increased from €81 million in the previous year to €88 million. The previous year’s figure still included negative earnings contributions from Real Eastern Europe in the amount of €6 million.

In financial year 2014/15, Real’s store network in Germany was reduced by 14 to 293 sites.

Key figures Real 2014/15 in year-on-year comparison

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Change in % compared with the previous year’s period

 

 

 

 

 

 

 

 

2013/14
€ million

2014/15
€ million

in €

Currency effects in percentage points

in local currency

like-for-like sales in local currency

1

Before special items

Sales

8,432

7,735

−8.3

0.0

−8.3

−0.8

Germany

7,939

7,735

−2.6

0.0

−2.6

−0.8

EBIT1

81

88

8.3

EBIT margin (%)1

1.0

1.1

Locations (number)

311

293

Selling space (1,000 m2)

2,145

2,031

Others

The Others segment comprises, among others, METRO AG as the strategic management holding company of METRO GROUP, the procurement organisation in Hong Kong, which also operates on behalf of third parties, logistics services as well as the real estate activities of METRO PROPERTIES, which are not attributed to any sales lines. These include speciality stores, warehouses and head offices.

In financial year 2014/15, sales in the Others segment totalled €56 million (2013/14: €10 million). Among other things, sales include commissions for third-party business through METRO GROUP’s procurement organisation in Hong Kong as well as the 4 Real stores in Romania since 1 October 2014.

EBIT totalled €–152 million in financial year 2014/15 (2013/14: €–95 million). Special items amounted to €89 million and relate, in particular, to one-time expenses in connection with the reorganisation of logistics structures in Germany. EBIT before special items amounted to €–63 million (2013/14: €–10 million). This result includes higher real estate gains, particularly from the sale of two centre locations in Eastern Germany. The lower result is particularly due to higher project costs, additional rental expenses and lower rental income.

Discontinued operations

Discontinued operations relate to Galeria Kaufhof and the associated consolidation effects.

Sales of Galeria Kaufhof fell by 2.5 per cent to €3.0 billion in financial year 2014/15. Like-for-like sales retreated by 1.9 per cent. This negative trend was mostly due to the decline in the textile market.

The EBIT of €1,015 million includes gains from the disposal of Galeria Kaufhof in the amount of €841 million and can therefore not be compared with the previous year’s figures. As such, EBIT before special items from discontinued operations amounted to €175 million (2013/14: €196 million).

Before this disposal on 30 September 2015, the store network of discontinued activities comprised 134 department stores, including 118 in Germany and 16 in Belgium.

Key figures discontinued operations (Galeria Kaufhof) 2014/15 in year-on-year comparison

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Change in % compared with the previous year’s period

 

 

 

 

 

 

 

 

2013/14
€ million

2014/15
€ million

in €

Currency effects in percentage points

in local currency

like-for-like sales in local currency

Sales

3,099

3,021

−2.5

0.0

0.0

−1.9

EBIT

196

1,015

Locations (number)

137

134

Selling space (1,000 m2)

1,446

1,418