Monday, July 15, 2024

Metcash releases full year results

Metcash’s 2024 Full Year Results report that the company’s revenue increased 0.7% to $15.9 billion, and including charge through sales, increased 0.7% to $18.2 billion.

“I am pleased to report that the company has delivered strong results for FY24, a year in which there was a further decline in the external environment,” says Metcash Group CEO Doug Jones.

“The results have been underpinned by our strategy, which is clearly working, and the disciplined execution of key initiatives.

“Operationally, all pillars performed well, in line with their strategic positioning, demonstrating resilience in the current softer market conditions.”

Mr Jones notes that the year was a milestone for the company from a strategic perspective with the announcement of major acquisitions in the food and hardware pillars.

“The acquisition of Superior Foods was completed earlier this month and will result in the further strengthening of our food business,” he says.

“It also opens-up new growth opportunities in the attractive and adjacent foodservices market.

“While in hardware, the acquisitions of Alpine Truss and Bianco Construction Supplies accelerates our ‘whole of house’ strategy and further strengthens the business’ market position.”

Food

Food sales (including charge-through and excluding tobacco) increased 4.6%, with strong growth in both supermarkets and Campbells and convenience.

Tobacco sales, however, declined 13.9% in the year due to an acceleration in illicit trade and the shift to alternatives.

In supermarkets, Metcash says the business continued to perform well in an “environment of increased value-conscious shopping”.

Wholesale sales excluding tobacco were up 4.7%, said to be underpinned by further improvement in network competitiveness and inflation.

The independent network offer continues to resonate, says Metcash, with shoppers retaining IGA in their shopping repertoire even as they increasingly shop around in their search for value. Foot traffic into stores increased for the year, albeit items per basket declined reflecting cost of living pressures on household grocery budgets.

The IGA retail network continued to invest in growth and, according to Metcash, remains “healthy, strong and confident”. There were a record 26 new store openings in the year, and 15 closures. Retail like for like sales growth in the IGA network was up 2.2%, excluding tobacco.

In Campbells and convenience, total sales, excluding tobacco, increased 4%.

Food EBIT also increased 3% to $210.1 million.

Liquor

Metcash says the liquor pillar continued to outperform in a more challenging market with total sales (including charge through) increasing 1.7% to $5.2 billion.

“An increase in cost-of-living pressures continued to drive shopper focus on value, lower consumption and a decline in on-premise sales,” says Metcash.

Wholesale sales to retail and contract customers increased 2.2%, resulting in further market share gains.

Sales growth was said to be underpinned by continuation of the increased preference for localised offers, including convenience, tailored ranges, competitive prices and local friendly service.

The highest growth categories were again RTDs and beer, says Metcash, with cost-of-living pressures driving shopper preference for lower priced value choices.

Liquor EBIT increased 4.9% to $109.2 million.

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