Metro AG, Germany’s largest retailer, said its second-quarter profit unexpectedly fell 15 percent as the company spent more to eliminate jobs.

Net income fell to 44 million euros ($57.6 million), or 13 cents a share, from 52 million euros, or 16 cents, a year earlier, the Dusseldorf-based company said on Monday in a statement. That missed the 87 million-euro average estimate of four analysts surveyed by Bloomberg. Sales rose 2.4 percent to 15.7 billion euros.
Metro aims to lift profit by 1.5 billion euros over four years through its Shape 2012 program as it slashes jobs at its Cash & Carry unit. The retailer generates almost half its revenue from wholesale operations, which have lost appeal to hotel owners and catering companies in some western European countries.
The company repeated that earnings before special items this year will “tangibly exceed” the 2.02 billion euros reported in 2009. Sales will be less than the company’s medium- term 6 percent growth target, though they will be higher than last year.
Metro has said it will eliminate an additional 900 jobs, or 6 percent of its workforce, at its domestic Cash & Carry unit after having already cut 1,000 positions. The company is trying to turn around a business that has been in decline for more than five years.
(Source: Bloomberg)