Overview of group business development

METRO’s business development in the past financial year 2019/20 was markedly impacted by the Covid-19 pandemic and its consequences. After a successful start and positive operational development in Q1 and Q2 of 2019/20, government measures in relation to the Covid-19 pandemic had a noticeable negative impact on METRO’s business development, especially from mid-March to the beginning of May 2020. From the second half of Q3 2019/20, thanks to the continuous easing of government restrictions and the roll-out of numerous operational initiatives, business development improved continuously again. In Q4 2019/20, another strong trend improvement was achieved in all regions and business development was almost at the level of the previous year. In this phase METRO benefited from the diversification of its business model and from its active positioning in the recovery phase of the HoReCa business.

The individual segments of METRO are affected by the Covid-19 pandemic to varying degrees. The development is dependent on

• the composition of the customer groups,
• the duration of government restrictions, and
• the extent of these measures in the respective countries.

The segments with a high Traders and SCO sales share were able to counteract the decline in HoReCa sales through the positive sales development in these 2 customer groups. The sales growth in Russia (31% Traders, 55% SCO sales share in financial year 2019/20) and Eastern Europe (excluding Russia) (33% Traders, 36% SCO sales share in financial year 2019/20) developed positively overall, while Germany (13% Traders, 46% SCO sales share in financial year 2019/20) remained roughly at previous year’s level. In segments with a high HoReCa sales share and where government measures were more stringent, the restrictions imposed on restaurants and hotels had a greater impact on business development. This was particularly noticeable in Western Europe (excluding Germany), where the HoReCa sales share in financial year 2019/20 accounts for 60% with a country portfolio that was particularly affected by the restrictions in the reporting year, such as France, Italy, Spain and Portugal.

For financial year 2019/20, this results in a like-for-like sales development of −3.9%. The like-for-like sales development was positive in Russia and Eastern Europe (excluding Russia). Germany was roughly at previous year’s level. Western Europe (excluding Germany) and Asia experienced significantly negative like-for-like sales growth, mainly due to the effects of the Covid-19 pandemic. Sales in local currency declined by −4.0%. Negatively impacted by adverse currency developments, especially in Turkey and Russia as well as other countries in Eastern Europe and Asia, reported sales of METRO AG decreased by −5.4% to €25.6 billion.

The adjusted EBITDA reached a total of €1,158 million in financial year 2019/20 (2018/19: €1,392 million). Government measures in the context of the Covid-19 pandemic had a negative impact on the majority of segments, especially in Western Europe. It was offset by cost savings (for example, in the course of the efficiency programme announced at the headquarters), improved earnings in logistics, licensing income from the partnership with Wumei and stable operating performance in Russia, Eastern Europe (excluding Russia) and Germany. Transformation costs of €47 million were incurred in financial year 2019/20 (2018/19: €0 million). They were exclusively incurred in the Others segment and relate in particular to the successful restructuring at the headquarters. The exchange rate developments of primarily the Russian and Turkish currencies had a negative impact on earnings. Adjusted for currency effects, the decrease was €−205 million (−15.1%) against the previous year.

Earnings contributions from real estate transactions amounted to €3 million (2018/19: €339 million). The EBITDA reached a total of €1,113 million (2018/19: €1,731 million).

The reconciliation from sales to like-for-like sales in local currency is shown in the following: