FRANKFURT: German retail giant Metro said Thursday that profits rose strongly in the first quarter, helped by strong Christmas business and gains from divestments.
Metro, which runs its business year from October to September, said in a statement that bottom-line net profit rose by 36 percent to 549 million euros ($620 million) in the three months to December.
Underlying or operating profit jumped by 42 percent to 1.2 billion euros, while sales slipped by 1.3 percent to 17.09 billion euros.
"The very good Christmas business made a contribution to this performance, especially in the group's home market of Germany, where it generated significant sales growth," Metro said.
Underlying profits were also boosted by the successful closing on the sale of the group's cash and carry business in Vietnam, it explained.
"In terms of reported earnings, we managed to post significant gains as a result of the closing on the sale of Metro C&C Vietnam, thereby further strengthening our balance sheet and our financial position," said chief executive Olaf Koch.
"Our operating performance... was very pleasing despite economic headwind in some countries. This illustrates clearly that we succeeded in growing more attractive for our customers overall," Koch said.
"However, the volatile exchange rates... had an negative impact on earnings. For the full year, I remain confident on account of the positive developments in many countries that we will meet our sales and earnings targets for Metro group," Koch said.
Metro said it made "significant progress in reducing debt, thereby further improving its financial situation."
Within the space of one year, net debt fell from 1.5 billion euros to just 100 million euros, "the lowest level in the history of Metro," it said.
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