(Corrects sales figure in third paragraph)
* Media-Saturn embroiled in power struggle with founder
* Metro confirms outlook, other units to compensate for
* Q2 sales down 7.6 pct, at low end of analyst forecasts
* Sales stronger in April, particularly in food
BERLIN/DUESSELDORF, May 8 German retailer Metro
AG cut its outlook for its consumer electronics
division on Thursday after a disappointing first quarter as the
unit struggled with competition from online rivals and a
The chief executive of Media-Saturn, Europe's largest
consumer electronics chain which accounts for about a third of
Metro's sales, quit on Tuesday amid a dispute between the firm's
founder, Eric Kellerhals, and majority shareholder Metro.
Metro reported Media-Saturn sales fell 4 percent in its
fiscal second quarter to 4.88 billion euros ($6.79 billion),
saying it had been unable to match performance in the previous
quarter due to the "consistently challenging market
Metro cut its 2013/14 outlook for the unit, saying it now
expected earnings before interest and tax (EBIT) before special
items to approximately match the prior year's level, compared to
a previous forecast for "sharply rising" earnings.
However, it said the Metro group remained on course to meet
its forecast for its 2013/14 fiscal year for a slight rise in
sales in local currency and EBIT before special items of about
1.75 billion euros, provided that exchange rates remain
constant, saying other units should compensate for Media-Saturn.
Europe's No. 4 retailer, a sprawling group which includes
hypermarkets and wholesale and department stores, has been
trimming its portfolio and cutting costs to respond to sluggish
demand in Germany and western Europe which account for
two-thirds of sales.
Sales for its fiscal second quarter, which runs from January
to March, fell 7.6 percent to 14.326 billion euros, while EBIT
before special items came in at a negative 40 million euros from
a positive 14 million.
Analysts polled by Reuters had forecast sales of 14.4
billion euros and an EBIT loss of 43 million.
The quarter is usually Metro's weakest and was compounded
this year by the fact Easter fell in April rather than March.
The figures were also hurt by falling emerging market
currencies and portfolio effects from the sale of businesses,
but Metro said it had already seen stronger sales in April,
particularly in its food business.
($1 = 0.7183 Euros)
(Reporting by Emma Thomasson; editing by Thomas Atkins and