Coles Group’s end of Financial Year 2024 results reveal a $1.1 billion total profit after tax. However, its liquor department saw underlying profits before interest and tax drop 8.3% despite a slight 0.5% normalised growth in liquor sales revenue. According to the Group’s ASX announcement, sales growth was impacted by a “challenging liquor market” in which “customers reduced their discretionary spending due to economic pressures.” Coles Group noticed customers decreased basket size and increased shop frequency across all of its liquor banners.
The results of Coles Group’s liquor department reflect those of main competitor Endeavour Group, which published a 3.3% increase in revenue and a 3.2% decrease in profits after tax in its FY24 results yesterday.
“The financial pressures on households and families have been front of mind for us this year and we have endeavoured to deliver value across our supermarket, liquor and online offerings to help customers balance the household budget,” said Leah Weckert, CEO at Coles Group.
“At the same time, we have worked hard to deliver improvements in availability and quality, made significant inroads in addressing loss, accelerated our digital offering, continued to maintain a strong focus on costs and completed the construction of our second Automated Distribution Centre and both our Customer Fulfilment Centres.”
Coles Group also continued to develop its e-commerce liquor presence, with revenue from online sales increasing by 9.2% and penetration to 6.2%. Earlier this year, Coles Liquor CEO Michael Courtney explained that developing an omnichannel presence was a key focus for the retailer group: “I think that part of that is where the opportunity sits for the industry, to be able to engage customers better through omnichannel around some of these products over the long term,” he said.
Over the past year, Coles Group added 244 new lines to its own-brand portfolio, focusing primarily on craft beer and RTD offerings. The portfolio collected 538 awards throughout the year. Additionally, First Choice Liquor Market was once again named Canstar Blue’s Best Liquor Retailer for 2024.
Moving forwards, Coles Group says its focus in liquor will remain in providing value to customers and delivering growth via its recently acquired Tasmanian liquor stores. Over the next year, it expects to open 13 new stores, close 10 stores, and renew a further 60.
“As we look ahead, we are well positioned to deliver on our strategic priorities,” said Leah Weckert.
“With ongoing cost-of-living pressures, we will also continue responding to the needs of our customers with a focus on value through every day low prices, promotions, Flybuys and Coles Own Brand.”
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