Metcash is reporting strong liquor sales in the new financial year as its commitment to chasing growth opportunities and attracting new customers pays off.
Chief executive Jeff Adams told investors at the company’s annual meeting that the company experienced strong sales for its liquor retailers, with modest growth expected to continue through the balance of fiscal 2019.
The news comes following a tough year for the company that saw it lose chief executive Steve Cain to rival Coles and issue a string of profit warnings and suffer a slide in share price.
However, shares in Metcash rallied more than 10% yesterday after chief executive Jeff Adams announced that an improvement in sales reported in June had continued into the new financial year.
Metcash’s liquor division, Australian Liquor Marketers (ALM), supports more than 2700 independently-owned stores operating under the IBA banner group including Cellarbrations, the Bottle-O, IGA Liquor, Thirsty Camel, and Porters Liquor. It's Australia’s largest broad-range liquor wholesaler, supplying more than 12,000 liquor-licensed premises.
Metcash noted that it was continuing to invest in its liquor business, upgrading stores and installing new cool rooms.
Among the division's five-year aspirations were to increase its presence in premium market through the expansion of Porters Liquor; e-commerce trials; tailor range and stores more to their communities; accelerate the store refresh program; pursue private label expansion; and provide suppliers with best route to market.
Recent customer satisfaction ratings from Roy Morgan show ALM has the highest liquor store chain rating at 93%, followed by Endeavour Drinks Group on 92.4% and Coles Group on 88.2%.
Praise for former Liquor CEO
Chairman Rob Murray said the company was "fortunate to have a very strong internal candidate" in Scott Marshall to take over as CEO Supermarkets & Convenience from Steven Cain following Steven’s resignation in March this year.
"Scott was the incumbent CEO of our Liquor business which has performed strongly for the past four years, and he previously led the Supermarkets’ Western Australia operations," he said. "Scott has more than 25 years’ experience in wholesale and retail at Metcash, and has well established relationships across our Supermarkets retail network.
"Scott’s appointment has been well received by our suppliers, our retailer partners and the Metcash Supermarkets & Convenience team."
Rod Pritchard has stepped into Marshall's shoes as interim CEO of ALM. Pritchard has extensive experience in the liquor industry, including three years at Metcash working closely with Marshall on the Liquor pillar’s growth initiatives, and over 15 years with liquor group Brown-Forman in various senior roles.
Metcash takes its liquor marketing to the cloud
ALM recently announced it is taking its marketing to the cloud after signing an agreement with Complexica for standardising and optimising its promotional activities using AI.
“Following a successful proof-of-concept earlier this year, we have selected Complexica as our vendor of choice for standardising and optimising our promotional planning activities,” said Rod Pritchard.
“Complexica’s Promotional Campaign Manager [PCM] will provide us with a cloud-based platform for automating and optimising promotional planning for more than 2700 stores, leading to improved decision-making, promotional effectiveness, and financial outcomes for our retail stores.”
Complexica's PCM will centralise and automate a wide variety of complex analytical tasks at ALM associated with the process of building effective promotional campaigns across retail stores, and will interface with ALM’s internal systems, so that staff can build promotional campaigns and pricing on a product, product group, and region level.
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