With the upcoming disposals of the Chinese operations and Real, Metro Group will be better placed to focus on its core wholesale business.
The sales of Metro China has been confirmed, with partner Wumei taking a majority stake. Metro Group is expected to receive over €1bn in net proceeds once the deal is completed. Metro has also confirmed that it is in exclusive talks over the sale of Real, with €500m expected from the sale. This €1.5bn will enable the group to invest in and focus on its core Cash & Carry business, with more than 70% of its turnover coming from wholesale once these deals have been completed.
Metro Group's strategy is being presented as Wholesale 360, an approach which sees it expand its core business and refine it. There is untapped sales potential within its core customer groups (hotels, restaurants and catering companies- HoReCa and Traders) and it will look to offer a wider portfolio of products and services to help it differentiate itself from other wholesalers. The approach consists of six key areas: products, digital tools, services, equipment, consulting and an online marketplace. Together these aim to help their customers, improving their competitiveness and strengthening the customer relationship over time.
Outlook for 2020
Total sales and like for like sales are expected to grow between 1.5-3% for the next financial year, in comparison to 2018/19 where they grew by 2.2% and 2.1% respectively. Performance in Russia is picking up, however the outlook remains cautious. Better performance is expected in Western Europe and Germany.
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