Germany's biggest retailer, Metro, has posted a drop in net profit for last year, citing the eurozone debt crisis and taxation effects as negative factors. The current year won't be much better.
Germany's Metro Group logged a 21-percent drop in net profit for 2011. The country's largest wholesale and retail trader announced on Tuesday that profit last year amounted to 747 million euros ($988 million).
Revenues dipped by 0.8 percent to total 66.7 billion euros. Metro attributed the disappointing results primarily to the eurozone debt crisis and slow business during last year's Christmas season.
Metro's self-service wholesale stores posted a meager 0.2-percent increase in turnover last year. But the group's three retail chains - electrical goods stores, supermarkets and department stores - all booked a decline in revenues. Metro's operative result (EBIT) decreased by 1.8 percent year-on-year to 2.4 billion euros.
Nonetheless, the company plans to expand its operations in the current year which will entail further costs. Hence profit prospects in 2012 aren't very good either.
"We already have indications that the current year will be very challenging for us again," Metro's new CEO Olaf Koch said in a statement. But he added that net profit would rise again in 2013 after a period of restructuring.
Metro is not the only European retailer which didn't fare well last year. The continent's largest, Carrefour of France, also posted a sizeable reduction in net profit for 2011 and announced a large-scale offensive to bring down prices in its stores.
By contrast, the world's biggest competitor in the sector, US-based Walmart, is very confident about the future after a sustainable recovery from years of crisis, leading to a considerable increase in revenues particularly on the domestic market.
hg/mll (Reuters, dpa, dapd)