Friday, July 19, 2024

Coles releases latest results

Coles has released its 2023 first quarter results, with Group sales increasing by 1.3% to $9.9 billion.

“Despite record levels of hospitality expenditure in Australia, we are pleased that a strengthening sales trajectory is being driven by improved availability, new value campaigns, and the unwind of local shopping as consumer shopping behaviour normalises,” says Coles Group CEO Steven Cain.

“Our commitment to providing trusted value, including Australia’s widest range of own brand products and the successful introduction of Dropped&Locked prices, is more relevant than ever with rising inflation placing pressure on many Australian households.

“I’d like to thank our team members, suppliers and community partners for their hard work during the quarter and for helping us to continue delivering our purpose to sustainably help all Australians lead healthier, happier lives.

“Our thoughts are with those Australians, including customers, team members and suppliers, currently doing it tough in Victoria and the East Coast with severe flooding.

“Coles is providing support to a number of flood-affected communities in northern Victoria including two semi-trailers with 40 pallets of essential groceries such as milk, pasta, rice, juice, coffee, tea, nappies and cleaning products donated and delivered to the Shepparton Showgrounds relief centre and additional supplies for the Njernda Aboriginal Corporation in Echuca.”

Supermarkets

Supermarkets sales revenue was $8.8 billion for the first quarter. This was an increase of 1.6% on the prior corresponding period, with comparable sales also growing by 2.1%.

Gross retail sales of $9 billion increased by 2.3%.

The growth was delivered despite supermarkets cycling heightened Covid-19 related sales in the prior corresponding period and customers returning to dining out at cafes and restaurants.

According to Coles, sales were supported in the first quarter by “strong” trade plans, including the ‘Locked’ value campaign as well as the Harry Potter Magical Builders collectibles and the Schott Zwiesel glassware customer continuity programs.

E-commerce sales declined by 11.5% (three-year growth of 105%) as sales normalised post Covid-19 lockdowns in the prior corresponding period with some customers returning to shopping in store. During the quarter, Coles Online launched a unified website to support ‘Anytime, Anywhere, Anyhow’ shopping while enhancements to the customer experience were also made to the unified shoppable app. The Coles Online network continued to expand with 14 same day home delivery stores and 19 Click & Collect (to the boot of car) stores added during the quarter.

Total supermarkets price inflation of 7.1% was recorded for the first quarter compared to 4.3% in the fourth quarter. In the first quarter, fresh inflation was 8.8% and continued to be driven by bakery, reflecting higher wheat prices, and fresh produce, particularly in fruit such as berries and bananas. Supermarkets recorded inflation excluding tobacco and fresh of 6.7% for the first quarter. Raw material, commodity, shipping and fuel costs remained the key drivers of supplier input cost requests received in the first quarter impacting inflation in packaged.

Volumes were said to be impacted in the first quarter from cycling elevated volumes in the prior corresponding period and declines in fresh produce volumes as a result of floods impacting supply.

“Pleasingly, improved availability saw volumes improve through the quarter, as did transactions as local shopping trends continue to unwind,” says the retailer.

Coles adds that it delivered “trusted value” to customers through the extensive Exclusive to Coles range with more than 800 Coles Own Brand products included in the ‘Locked’ campaign. Exclusive to Coles sales of $2.9 billion were recorded in the first quarter, an increase of 1.1% on the prior corresponding period.

During the quarter, Coles completed three renewals while four stores were opened and one closed, taking the total network to 838 supermarkets.

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