* Q1 EBIT before items at 821 mln euros vs consensus for 829
* Q1 Cash & Carry EBIT before items drops 6 pct
* 2016/17 outlook confirmed
(Adds details, analyst comment)
Feb 3 German retailer Metro, which
plans to split into two companies this year, reported slightly
lower than expected profit in the critical Christmas quarter,
hurt by the performance of its Cash & Carry and hypermarket
Earnings before interest and taxation (EBIT) excluding
special items fell 0.8 percent to 821 million euros ($883
million) in the October-December quarter, Metro said. Analysts
on average expected 829 million euros.
The Cash & Carry business that serves independent traders,
hotels and restaurants saw its EBIT before one-off items fall 6
percent to 431 million euros, missing the average estimate of
445 million euros, as price cuts in Russia weighed on results.
Core profit at Real hypermarkets, battling tough competition
from discounters and a shift towards smaller, more frequent
shopping trips, also declined more than expected.
"We expect today's statement to put more focus on
operational challenges the Group is facing (particularly at the
FoodCo) as most of the debate in recent months has been around
the demerger process and portfolio optimisation," Morgan Stanley
analysts said in a note.
Metro shares traded 2.4 percent lower at 0818 GMT.
Metro's shareholders are due to vote on the split off of the
Cash & Carry wholesale business along with Real, from consumer
electronics group Media-Saturn on Monday. The split is expected
to happen by the middle of the year.
Chief Executive Olaf Koch said on Friday that he was
confident about the outcome of the shareholder vote on the
Three anchor shareholders -- Haniel, Schmidt-Ruthenbeck and
Beisheim -- representing almost 50 percent of the vote - have
already indicated their support.
The company hopes that the move will help the two
independent companies pursue more acquisitions and trigger a
revaluation of the stock.
Metro currently trades at a discount to other pure wholesale
retailers like Sysco and Britain's Booker, which
Tesco has offered to buy.
Metro confirmed its forecast for the 2016/17 fiscal year for
a slight rise in overall sales and a slight improvement in EBIT
before special items. Its financial year runs until the end of
($1 = 0.9296 euros)
(Reporting by Sylwia Lasek; Editing by Thyagaraju Adinarayan)