DUESSELDORF (dpa-AFX) - German consumer electronics retailer Ceconomy AG (MTAGF.PK, MTTRY.PK) reported Wednesday that its net profit for fiscal year 2017/18 was 23 million euros, compared to 206 million euros before special items last year.
Ceconomy impaired its stake in METRO AG by a total of 268 million euros in the reporting period. Due to the impairments and a weaker operational development, earnings per share for continuing operations declined to 0.07 euros, compared to 0.63 euros before special items last year. The change in net working capital improved to 302 million euros before currency effects.
Excluding the earnings contribution from Fnac Darty S.A. Of 21 million euros, EBITDA for the financial year was at 630 million euros below the previous year's level of 714 million euros before special items. Excluding the earnings contribution from Fnac Darty, EBIT amounted to 399 million euros, compared to 494 million euros before special items in the prior year. The decline in earnings was attributable in particular to the decline in sales in Germany and Switzerland.
Adjusted for currency and portfolio change effects, sales for the financial year 2017/18 rose slightly by 0.2 per cent compared to the previous year. On a reported basis, however, Group sales declined by 0.9 per cent to 21.4 billion euros from 21.6 billion euros last year. This was primarily by the decline in brick and mortar sales. Notably, in Germany this was also due to the unusually hot weather in July and August. On the contrary, positive contributions came from the strong growth of the Online and Service business as well as the Football World Cup. However, this could not compensate for the decline in the stationary product sales.
Ceconomy's Online sales increased by 13.0 per cent year-on-year. The Online business thus accounted for 12.1 per cent of total sales,which equals a total of 2.6 billion euros in the past financial year.
For the financial year 2018/19, Ceconomy expects a slight increase in total sales compared to the previous year. The Company expects net working capital to decline moderately.
Both in terms of EBITDA and EBIT, Ceconomy expects a slight decline, not taking into account the earnings contributions from the investment in Fnac Darty S.A. The segments DACH and particularly Eastern Europe will contribute to this decline, while the segment Western & Southern Europe will develop slightly positive. The comparative previous-year figures for 2017/18 were 630 million euros EBITDA and 399 million euros EBIT.
In addition, EBITDA and EBIT will also include the share of the profit or loss for the period for Fnac Darty S.A. Based on current analyst estimates, Ceconomy expects this investment to make a contribution to earnings in the mid double-digit million euros range in financial year 2018/19.
Meanwhile, Ceconomy said that chief financial officer Mark Frese will leave the company at own request as of 31 December 2018. Bernhard Düttmann, member of the Supervisory Board of the company, will take over the duties from Mark Frese on an interim basis effective as of 1 January 2019.
Ceconomy noted that Düttmann is delegated to the Management Board from within the Supervisory Board. His seat on the Supervisory Board will be suspended until further notice. The search for the future chief financial officer of Ceconomy is ongoing. As soon as an agreed candidate for the chief financial officer position has been found, Düttmann will resume his position and his duties as a member of the Supervisory Board of CECONOMY. The search for a new chief executive officer for the Company is also going according to plan. As of 1 January 2019, the Management Board of Ceconomy will thus consist of Dr Bernhard Düttmann and Dieter Haag Molkenteller.
Copyright RTT News/dpa-AFX