Initiative that supports start-ups, for example with coaching, thus accelerating the development and implementation of their business ideas. METRO has launched the METRO Accelerator powered by Techstars to support start-ups with innovative technologies for use in the food service, hospitality, catering and retail sectors.
Amfori Business Social Compliance Initiative (Amfori BSCI)
Founded in 2003, this global business association for open and sustainable trade works to ensure that production in all supplier countries complies with minimum social standards. The initiative aligns its standards with the UN’s Universal Declaration of Human Rights and the conventions of the International Labour Organization (ILO).
Also audit. A procedure that assesses an organisation’s processes and structures according to previously formulated standards and guidelines. Audits shed light on the effectiveness of process optimisation measures. If an audit is conducted by an external auditor, the certificate issued after the review can be used as evidence of adherence to standards.
Carbon Disclosure Project (CDP)
The unaffiliated organisation was founded in London in 2000 by companies. It aims to disclose companies’ CO2 emissions as well as their climate and reduction risks, thereby contributing to the transparency of their corporate financial reporting on climate-relevant data. Each year, the CDP conducts standardised company surveys on a voluntary basis.
Commercial Paper Programme
Ongoing capital market programme typical of money markets that covers short-term financing needs. It facilitates the issuance of commercial papers (CP) as discounted, unsecured bearer bonds without standardised terms of maturity.
Committee of Sponsoring Organizations of the Treadway Commission (COSO)
US-based private-sector organisation that developed and published a standard for internal controls in 1992 that is recognised by the U.S. Securities and Exchange Commission. In 2004, this standard was updated and the COSO ERM (Enterprise Risk Management – Integrated Framework), also known as COSO II, was published.
All measures specifying a company’s and its employees’ behaviour in accordance with legislation, established social guidelines and values.
Cost of capital
See Weighted Average Cost of Capital (WACC).
Currency effects result from situations where the same amount of currency units is translated into another currency at differing exchange rates.
The delivery segment includes sales from transactions without customer contact with a METRO store. This definition also forms the basis for the operational management of the delivery business. The previous annual reports included additional revenues from transactions with delivery-related services of the METRO stores. It includes commissioning products for later pick-up or delivery of the commissioned products to the customer’s location.
A central element of HR policy that harnesses the diversity of employees for corporate success in terms of gender, age, ethnicity, beliefs, sexual identities and potential disabilities.
Dow Jones Sustainability Index (DJSI)
An index family that measures the sustainability of the company. The measurement is comprised of economic, environmental and social criteria. The measured criteria for listed companies include, among others, corporate management, workforce policy, transparency, human rights and risk management. Among all sustainability indices, the DJSI family carries a particular cachet in terms of quality.
Conditional purchase price (part) payment in the context of an acquisition of subsidiaries, usually tied to a performance target.
Earnings per share (basic/diluted)
The earnings per share (basic) are calculated by dividing the profit or loss attributable to the shareholders of METRO AG by the weighted average of shares in circulation. The earnings per share (diluted) give additional consideration to the effect of so-called potential shares, such as those issued in the context of stock options.
EBIT (Earnings Before Interest and Taxes)
Profit or loss before financial result and (income) taxes. Due to its independence from different forms of financing and tax systems, this key figure can also be used for international comparison with other companies.
EBITaC (Earnings Before Interest and Taxes after Cost of Capital)
EBIT after the costs of the employed capital. This indicator shows whether a company successfully uses its business assets and achieves value added that exceeds the cost of capital.
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation)
Profit or loss before interest result, income taxes, depreciation/amortisation/impairment losses/reversals of impairment losses on property, plant and equipment, intangible assets and investment properties. This key figure serves the purpose of comparing companies with accounting systems that follow different accounting rules.
EBITDAR (Earnings Before Interest, Taxes, Depreciation, Amortisation and Rent)
EBITDAR is defined as the EBITDA before expenses or income from rent.
EBT (Earnings Before Taxes)
Profit or loss before (income) taxes. This indicator is used to compare companies, although different taxation systems may exist.
EVA (Economic Value Added)
Value-oriented key figure that depicts the absolute value contribution of a company created in a single period under consideration of a risk-adjusted interest rate. It is derived from the difference between the company profit after tax and the cost of capital on the average capital employed.
Recognised fair value. Amount that would have been received in return for the disposal of an asset or paid for the assignment of a debt in an ordinary transaction conducted between market participants on the assessment date.
Under the global term food, METRO summarises the following categories of goods: fresh foods, durable foods, nutrients, frozen foods and drinks of all kinds, as well as luxury foods, dietary supplements and pet food, but also detergents, cleansers and cleaning agents, which are sometimes also labelled as near-food. All other goods are considered non-food items.
Also licence sales or franchising system. Contractually regulated form of organisation: the franchisor grants independent franchisees the right to offer certain goods or services using a franchisor’s name or trademark.
Free cash flow
Free cash flow = reported EBITDA – investments excluding finance lease extensions and mergers and acquisitions +/- changes in net working capital
Free cash flow conversion
Free cash flow conversion = (reported EBITDA – investments excluding finance lease extensions and mergers and acquisitions +/- changes in net working capital) / reported EBITDA
Global Food Safety Initiative (GFSI)
The initiative was established in 2000 by retail companies. It is the world’s largest organisation for the improvement of food safety. The initiative promotes the establishment of international audits that reduce food-related risks and evaluate food suppliers within that context.
A private sector organisation that certifies agricultural and aquacultural products. The standard for ‘good agricultural practice’ (GAP) resulted from an initiative of European retail companies.
Statutory and factual regulatory framework for the management and supervision of a company.
Governance management system
System for controlling all management and monitoring processes of a company. The METRO governance management system comprises the risk management system, the internal control system, the compliance management system and the internal auditing system.
Short for hotel, restaurant and catering businesses. The HoReCa segment is an important customer group for METRO Wholesale.
Hospitality industry sector
Summary term for hotels, restaurants and catering companies, often referred to as HoReCa industry sector.
IASB (International Accounting Standards Board)
An independent international body with its registered office in London, UK, that develops and continually revises the International Financial Reporting Standards (IFRS).
Interpretation on IFRS prepared by the IFRS Interpretations Committee (or its predecessor) and approved by the IASB.
IFRS (International Financial Reporting Standards)
Internationally applicable rules for financial reporting developed by the IASB. Contrary to the accounting rules under the German Commercial Code, the IFRS emphasise the informational function.
IFRS Interpretations Committee
Committee appointed by the IFRS Foundation and tasked with the development of guidelines for the interpretation questions concerning the practical implementation of the IFRS. Until 2010, the committee traded under the name IFRIC (International Financial Reporting Interpretations Committee).
ISAE 3402 (International Standard on Assurance Engagements)
A globally applicable standard for the preparation of assurance reports for control systems in service companies.
Like-for-like sales growth, like-for-like sales development
Like-for-like sales growth, reflecting sales growth in local currency on a comparable area or with respect to a comparable group of locations or merchandising concepts such as online retail and delivery. The figure only includes sales of locations with a comparable history of at least 1 year. This means that locations affected by openings, closures or material refurbishments during the reporting period or comparison year are excluded.
Calculation of the fair value of financial instruments on the basis of market prices at a particular assessment date.
METRO Wholesale Operating Model
Organisational and management model introduced at METRO Wholesale in 2015. It is supposed to foster an entrepreneurial spirit within the organisation by transferring greater responsibility and creative freedom to the national subsidiaries. At the same time, measures geared towards specific customer groups (for example for hotels, restaurants and catering firms) are cross-nationally coordinated.
A specific type of e-commerce. In this case, the electronic marketing and retail of merchandise and services are conducted on a mobile device, such as a smartphone.
The net debt results from the balance of the financial liabilities (including liabilities from finance leases), cash and cash equivalents less financial investments. Financial investments include short-term bank deposits and short-term liquid debt instruments.
Net Promoter Score (NPS)
Key figure that is used to provide information regarding the performance and customer satisfaction of a company. A standardised customer survey provides rating and feedback from customers that can be used to calculate a comparable cross-company measured value.
Net working capital
The net working capital includes inventories, trade receivables and receivables due from suppliers included in the item other financial and non-financial assets. Trade liabilities are deducted from the total amount of these items.
Includes statements concerning environmental, social and employee affairs, as well as statements concerning respect for human rights and the combat against corruption and bribery and is prepared for the parent company as well as for the group.
Omnichannel retail, omnichannel distribution
A development in multichannel marketing. Combination of traditional store-based retail with e-commerce, social media and applications for smartphones and tablets. Integrating all channels offers consumers a flexible and seamless shopping experience as the channels are holistically linked in all purchasing phases.
Trademark-protected brand-name products developed by a retail company with an attractive best price/performance ratio.
Performance-based investment. A performance share entitles its owner to a cash payment matching the share price.
Adjustments to group structures are referred to as portfolio measures or portfolio effects.
Period of 12 months, usually cited as reference for statements in an annual report.
Different processes that contribute to the added value of a company. At METRO, these include logistics, marketing and sales.
In the financial sector, ratings represent the systematic, qualitative measurement of creditworthiness. Ratings are expressed in various grades of creditworthiness. Renowned agencies that issue ratings are Standard & Poor’s, Moody’s and Fitch.
Companies with a completely independent market presence.
Return on Capital Employed (RoCE)
RoCE is a key figure that indicates the rate at which the employed capital (less liquid funds and short-term debt capital) is bearing interest at METRO.
Part of a retail company that operates outlets or stores with a specific merchandising concept.
SCO (Service Companies and Offices)
SCO customers are one of METRO’s 3 core customer groups. Service Companies and Offices (SCO) are professional service companies and organisations, such as offices and institutions.
Sedex audit according to SMETA
Sedex, a data platform for transparency in the sustainability commitment of companies, provides SMETA (Sedex Members Ethical Trade Audit), one of the world’s most frequently used concepts for social audits. The audit is focused on working conditions, occupational safety, environmental management and business ethics as well as respect for human rights and temporary employment.
Unit for performance shares.
Abbreviation for Small and Medium-Sized Enterprise Services: Services for small and medium-sized enterprises. SME services stands for METRO’s strategic approach of offering customers customised solutions for the challenges of their business. In addition to food and non-food items, it includes professional services and digital solutions. By intertwining services and product ranges, METRO will be able to offer its customers a more comprehensive assortment in the future and respond more specifically to their needs.
The adherence to laws, guidelines, standards, codes and/or social conventions by which an organisation ensures socially responsible operations within its value and supply chains. The aim is to protect the safety, health and basic rights of employees in their own company as well as among its suppliers.
Business transactions or a number of uniform business transactions that do not recur regularly, that are reflected in the income statement and that have a significant impact on business activities are classified as special items. As a result, the presentation of special items better reflects ordinary business performance and contributes to a better understanding of the earnings position.
Newly founded company characterised by an outstanding business idea and a high degree of innovation.
Sustainable Development Goals (SDGs)
Under the title ‘Transforming our world: the 2030 Agenda for Sustainable Development’, the United Nations established political goals that are aimed at the entire international community, companies and private individuals. The agenda has formulated 17 main objectives that take into account all 3 dimensions of sustainability: economic, social and environmental. METRO is aware of its responsibility and contributes to the achievement of the goals.
Task Force on Climate-related Financial Disclosures (TCFD)
Task force set up by the Financial Stability Board (FSB) in 2015 with the objective of consistently disclosing climate-related financial risks in order to provide different stakeholders with consistent information. The task force’s recommendations are intended to help companies customise their climate-related risk reporting to the needs of investors. Information is published on a voluntary basis.
Total shareholder return (TSR)
TSR is a key figure that indicates the performance of an investment in shares under inclusion of capital gains and dividends.
The term ‘Traders’ at METRO Wholesale refers to the customer group of independent resellers such as operators of small grocery stores and kiosks, street food vendors, gas stations and wholesalers.
Weighted average cost of capital (WACC)
Weighted average (total) cost of capital. The WACC results from the weighted average of the cost rate for equity and debt capital on the capital markets. The weighting is based on the equity and debt capital components of METRO measured at market prices.
Wholesale, METRO Wholesale
The METRO Wholesale segment comprises the METRO Wholesale sales line of METRO AG with 678 wholesale stores across 34 countries worldwide. This also includes the delivery business (Food Service Distribution) with the METRO delivery service and companies like the delivery specialists Classic Fine Foods, Pro à Pro and Rungis Express.