Overview of group business development

Financial year 2020/21 was particularly dominated by the Covid-19 pandemic and the associated government measures. They had a negative impact on the business development, especially in the first half of the year. In the course of the second half of the year, government measures were eased, resulting in a trend reversal and a significantly improved business performance. This is partly attributable to the relaxation of Covid-19 protective measures, which began gradually in May and became more wide-ranging as the financial year progressed. On the other hand, METRO took numerous measures at country level to reinforce its operational business in the food service and hospitality industries. The measures included activation of existing customers and acquisition of new ones, for example through ‘new start’ discounts, payment term campaigns or special assortments.

The development of METRO’s individual segments has been affected by the Covid-19 pandemic to varying degrees. The development largely depends on the composition of the customer groups as well as the duration and intensity of the restrictions in the respective countries. After declines in the first half of the year, sales of the HoReCa customer group increased significantly again in the second half of the year in the course of the recovery of the hospitality and tourism industry. Especially in countries with a high HoReCa share of sales and in countries where government measures were more stringent at the beginning of the year, progress in the fight against the pandemic and the associated positive effects on public life and METRO’s business development became apparent in the second half of the year. Thus, since June, sales have been above the pre-pandemic level. According to market estimates¹npdgroup CREST panel, NPD., METRO outperformed the HoReCa market in Germany and in some other Western European countries with strong HoReCa performance.

For financial year 2020/21, after a strong development in the second half of the year, sales development in local currency is at previous year’s level (0.0%). Like-for-like sales decreased slightly by −0.4%. The sales development in local currency was positive in Eastern Europe, Russia and Asia. Germany and Western Europe recorded a negative sales development, mainly due to the effects of the Covid-19 pandemic. Due to negative currency effects, especially in Russia and Turkey, sales in € decreased by −3.4% to €24.8 billion.

Adjusted EBITDA reached €1,171 million in financial year 2020/21 (2019/20: €1,158 million). Here again, the recovery in sales was also reflected in the earnings development. Furthermore, positive one-time effects in the mid-double-digit million euro range had an impact in the segments Western Europe (excluding Germany), Eastern Europe (excluding Russia) and especially in the Others segment, which mainly occurred in H1 2020/21. Negative currency effect developments, especially of the Russian and Turkish currencies, also impacted the earnings development. Adjusted for currency effects, EBITDA increased by €72 million or 6.5% (with Aviludo and Davigel Spain) compared to the same period of the previous year. Transformation costs of €65 million were incurred in financial year 2020/21 (2019/20: €47 million). They are mainly attributable to Q4 2020/21 and relate to the country exits from Japan, Myanmar and the Philippines (Classic Fine Foods).

Earnings contributions from real estate transactions amounted to €60 million (2019/20: €3 million) and resulted mainly from the sale of the last remaining real estate property of the hypermarket business, the disposal of an at-equity investment in a retail location portfolio in Germany and a sale-and-leaseback transaction in Portugal. The EBITDA reached a total of €1,166 million (2019/20: €1,113 million).

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