BRUSSELS, Sept 15 (Reuters) - Belgian supermarket chain Colruyt forecast on Wednesday net profit would rise by 5 percent this financial year, less than analysts expect, and said it aimed to split its shares by five.
Jef Colruyt, chairman of the discount retailer which has a history of being cautious with forecasts, told shareholders that net earnings for the year ending on March 31, 2011 should rise to 346 million euros ($448.7 million).
Colruyt's 2009/2010 net profit was 329.6 million euros. The mean forecast of 21 analysts in a Thomson Reuters I/B/E/S poll is for a profit of 357 million euros, an increase of 8 percent.
Colruyt, whose revenue rose by 8.5 percent in the first quarter, said at its annual shareholder meeting that salaries of households in Belgium would rise due to an automatic link with inflation, safeguarding their spending power.
However, wage hikes and the addition of 3,000 more jobs in the Colruyt Group would raise the company's costs.
Colruyt said it would update its forecast when publishing its half-year results at the end of November.
The company has already forecast 4.25 to 6.5 percent growth of revenue for its Colruyt stores, which account for some 65 percent of the business. Colruyt also owns baby stores and gasoline stations.
Colruyt explained the wide range of the forecast was due to uncertainty about food inflation.
The five-for-one share split, a bid to make Colruyt shares more accessible to individual investors and employees, would be put to an extraordinary meeting of shareholders on October 12.
The shares closed on Wednesday at 198.75 euros.
Colruyt competes in Belgium with German discounters Aldi and Lidl, France's Carrefour and high-end Belgian retailer Delhaize . (Reporting by Philip Blenkinsop; Editing by Louise Heavens) ($1=.7711 Euro)