Australia's Coles beats annual profit view on strong supermarket sales
Annual profit rises 2.1% to A$1.13 bln
Final dividend hiked amid strong performance
Expects higher financing costs in fiscal 2025
Rewrites paragraph 1, adds context in paragraphs 2-3, details on results in paragraphs 6-8
Aug 27 (Reuters) -Coles COL.AX, Australia's second-largest grocer, posted its annual profit above analysts' estimates on Tuesday, fuelled by strong sales at its supermarkets and improved inventory management that effectively mitigated theft-induced stock losses.
Coles bolstered its competitive position through expanded private-label offerings, surging ecommerce sales, and moderating inflation, which fostered a more stable pricing environment and aided in attracting price-sensitive customers.
Coles noted a trend of moderating dairy inflation and fewer supplier price hikes, allowing for more stable pricing for customers despite rising commodity costs for cheese and eggs.
The grocer reported a 2.1% rise in netprofit after tax from continuing operations of A$1.13 billion ($765.01 million) for the year ended June 30, beating a Visible Alpha consensus estimate of A$1.08 billion.
Revenue from sales at the supermarket business rose 4.3% to A$39.04 billion from a year earlier.
Coles reported a 3.7% increase in supermarkets sales in the first eight weeks of fiscal 2025, driven by a consumer shift towards at-home dining, with the company's convenience meals continuing to be top-performing category.
The grocer, however, logged a 9.4% jump in capital expenditures to A$1.42 billion for the year mainly due to increased investments in store renewals and efficiency initiatives, including its stock loss technology.
In fiscal 2025, capital expenditure is expected to be A$1.2 billion, with more store openings planned for its supermarkets and liquor segments.
The more than 100-year-old Melbourne-based retailer declared a final dividend of 32 Australian cents per share, up from 30 Australian cents a year earlier.
($1 = 1.4771 Australian dollars)
Reporting by Roushni Nair & Rajasik Mukherjee in Bengaluru; Editing by Maju Samuel
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
