Highlights
- Coles reported its full-year results today (24 August) The supermarket group issued a fully franked final dividend of 30.0 cents per share.
- The company’s net profit after tax increased by 4.3% to AU$1,048 million.
Australian supermarket group Coles Group Ltd (ASX:COL) reported its full-year results today (24 August 2022) for the financial year 2022 through an ASX filing.
Coles said in the ASX filing that despite substantial COVID-19 and flood delays, the third year of strategy execution resulted in good Supermarkets sales and earnings.
Meanwhile, shares of Coles were trading 4.01% lower at AU$17.95 per share on ASX today at 10.48 AM AEST. This underperforms ASX 200 Index, which was 0.54% up at 6,999.10 points today at 10.49 AM AEST.
Total supermarket price inflation was 1.7% for the year, and 4.3% in the fourth quarter. Fresh inflation was 4.7% in the fourth quarter, driven by both bakery - which reflected increased wheat prices - and fresh produce, which impacted supply of vegetables such as tomatoes, capsicums, and broccoli.
Highlights of Coles’ FY22 results
- COVID-19 linked prior year sales increased by 2.0% to AU$39.4 billion, thanks to strong eCommerce performance in supermarkets and Liquor cycling.
- Three-year headline sales growth of 12.0% in Supermarkets, 18.0% in Liquor and 8.1% in Express.
- Comparable sales increased by 3.7% in Supermarkets, 1.9% in Liquor, and 1.1% in Express in the fourth quarter.
- , Net profit after tax increased by 4.3% to AU$1,048 million.
- Despite considerable COVID-19 expenses, transformation project costs, flood events, and lower Express earnings due to COVID-19 lockdowns, EBITDA and EBIT were stable at AU$3,440 million and AU$1,869 million, respectively.
- Smarter Selling benefits totalled over AU$230 million in FY22, putting Coles on target to meet its four-year goal of AU$1 billion in benefits by the conclusion of FY23.
- 104% cash realisation, AU$1.2 billion in capital expenditure, and AU$506 million in net debt
- Fully franked final dividend of 30.0 cents per share issued, bringing total FY22 dividends to 63.0 cents per share, a 3.3% increase over FY21.
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Data Source- Company announcement dated 24 August 2022
COVID-19 and flood impact on supermarkets
For much of the first half, extended lockdowns in New South Wales, the Australian Capital Territory, and Victoria resulted in greater sales and customers preferring or being forced to buy locally rather than in larger shopping centre stores. As limitations were removed, sales growth remained high, with a strong Christmas business period and increased contribution from shopping center stores.
Local purchasing trends re-emerged as Omicron became more dominant in the second half, despite the lack of legal limits.
With no explicit COVID-19 limits, local shopping patterns slowed, with shopping center retailers contributing more to the fourth quarter.
Early in the second half, highly disruptive flood events in South Australia, New South Wales, and Queensland produced major road and rail logistics disruptions, including the longest recorded road and rail outage to Western Australia, which affected availability.