Metro profit falls larger than forecast
FRANKFURT - ReutersGerman retailer Metro reported a bigger-than-expected plunge in quarterly profit as it cut prices to lure crisis-hit customers, and warned the outlook, even at home, was worsening.
Retailers across Europe have been feeling the pain as shoppers hit by rising unemployment, higher prices and low wage growth hold back on spending on non-essential items, especially on non food purchases such as electronics.
While Metro said it was especially southern and parts of eastern Europe that were responsible for the fall in profit, Chief Executive Olaf Koch said sentiment was also worsening in Germany.
Even though consumer morale rose unexpectedly going into November, German joblessness rose for a seventh month in a row in October, highlighting the vulnerability of Europe’s biggest economy to the euro zone crisis.
In Germany, which is Metro’s single largest market, the group reported a 2 percent fall in sales in the third quarter.
Selling the Real operations would follow similar moves from rival Carrefour, which has exited Greece, Singapore and Colombia and is also keen to sell operations in Poland and Turkey as part of a major restructuring program.