* Sees 2013/14 EBIT before items at 1.75 bln euros
* Had previously forecast marked improvement from 1.7 bln
* Q1 EBIT before items 1.07 bln euros vs poll 1.08 bln
* Aims to improve profits at Media-Saturn
* Shares down 1.5 pct
By Emma Thomasson and Matthias Inverardi
BERLIN/DUESSELDORF, Feb 11 German retailer Metro
AG reined in full-year profit expectations on Tuesday
after a dip in first-quarter earnings, largely due to lower
real-estate income and the strong euro.
Europe's No. 4 retailer said on Tuesday it expected more
stable economic conditions and exchange rates to lift earnings
before interest and tax (EBIT) before special items to about
1.75 billion euros ($2.4 billion) for its 2013/14 fiscal year.
However, it had previously said earnings should "markedly
exceed" a comparative level of 1.7 billion euros from 2012/13.
"Management guidance for FY 2013/14 is slightly below market
expectations, which could cause some (share) price pressure in
the short term," said DZ Bank analyst Herbert Sturm.
Metro shares, which trade at 16 times forward earnings - a
slight discount to Europe's biggest retailer Carrefour
- were down 1.5 percent at 0825 GMT, underperforming a 0.8
percent rise in the European retail index.
Metro's EBIT before special items fell 16 percent to 1.07
billion euros for the three months through December, just shy of
an average analyst forecast for 1.08 billion.
The firm, a sprawling group with 2,200 stores in 32
countries which is in the midst of trimming its portfolio and
cutting costs, said the fall was due to the lack of income from
real estate sales, which boosted last year's results, as well as
the sale of its Real supermarkets in eastern Europe.
Profits were also dented by a strong euro and lower earnings
at its Media-Saturn consumer electronics chain, which has been
struggling from online competition and saw EBIT before special
items fall to 289 million euros from 332 million.
Metro said it would seek to improve profitability at
Media-Saturn, the world's second biggest consumer electronics
group after Best Buy Co, by further reducing stock
levels, improving purchasing processes and cutting costs.
Chief Executive Olaf Koch told journalists the group's
performance in the Christmas quarter - when it makes more than
half of its profits - laid a "solid foundation" for the group to
pay out a dividend again after it shocked investors last year by
scrapping a payout.
Metro shares have been supported in recent months by Metro's
plan to float its Russian wholesale business, with the London
listing expected around Easter, two people familiar with the
plans told Reuters last week.
The company, which also runs cash and carries and department
stores, reiterated it expects to see a slight rise in sales in
local currencies this financial year.