Australia’s Coles beats annual profit view on strong supermarket sales
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COLES, 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 per cent rise in net profit after tax from continuing operations of A$1.13 billion (S$998 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 per cent to A$39.04 billion from a year earlier.
Coles reported a 3.7 per cent 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.
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The grocer, however, logged a 9.4 per cent 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. REUTERS
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