Metcash has announced a profit after tax for the past financial year of $216.5 million, a turnaround from the $384.2 million loss in financial year 2015.
Group sales revenue increased 1.3 per cent to $13.5 billion, while EBIT fell 7.4 per cent to $275.4 million, in line with expectations. The company strengthened its balance sheet by reducing its net debt by $392.3 million, to $275.5 million. Metcash also announced its intention to restart divided payments, starting from the financial year 2017 final dividend and subject to capital requirements.
The group put the results down to a focus on cash management and capital recycling, which included the sale of the automotive business.
“The group has completed the second year of its transformation plan and we have made significant progress,” Metcash CEO Ian Morrice said. “Key supermarkets initiatives are delivering returns and the liquor and hardware businesses continue to build momentum. The group is focused on supporting independent retailers to ensure that we are well positioned to deliver the ‘best store in town’ for their customers.”
Key trading results
- Total sales increased 0.5 per cent to $9.3 billion, compared to $9.2 billion the previous year.
- If the estimated impact of damage to the NSW distribution centre is taken into account, the result would have been 0.9 per cent.
- The underlying trend in supermarket sales continues to improve.
- Total sales grew 0.4 per cent to $1.6 billion.
- The growth in convenience store revenue was largely offset by a decline in Campbells’ reseller revenues.
- Total sales increased 3.7 per cent to $3.2 billion, as compared to $3.1 billion the previous year. This was due to the strong performance of the IBA network and conversion of customers to the Metcash banner group.