Endeavour Group's maiden yearly results show $11.6b in sales

Endeavour Group sales increased by 9.3 per cent to $11.6b for FY21 with strong growth in retail due to at-home consumption and a resilient hotels performance which saw 'a rapid return to business' as lockdowns lifted.

For the year, retail sales were up 9.6 per cent to $10.2 billion and hotel sales up 7.3 per cent to $1.4 billion.

CEO Steve Donohue said, "The strength of this year's result has demonstrated the resilience of our business model and the commitment of our team to living our purpose and values and delivering for their customers and communities.

"We are excited that we are entering the new year with a robust balance sheet and a significant number of opportunities to create value, including growing our digital engagement, expanding and enhancing our network and optimising our business through a focus on profitability and capital management."

The Group remains optimistic about growth in the retail sector continuing through FY22, despite continuing volatility. The business acquired 33 new stores – either BWS or Dan Murphy’s – meaning Australia is now home to 251 Dan Murphy’s and 1392 BWS stores.

Online sales grew by 34.7 per cent with Endeavour having made significant improvements in growing digital engagement, including improved websites and apps, personalising the experience and improving online fulfilment. Online sales now account for 8.4 per cent of total retail sales, up from last year’s 6.9 per cent.

All categories of drinks grew with largest growth in Spirits at more than 20 per cent. Consumption continues towards premiumisation with strong growth in craft beer, Champagne, gin and nolo. Pinnacle Drinks acquired 530 new products this past year with a focus on award-winning brands.

In terms of future growth, EDG's CFO Shane Gannon identified pubs as an immediate opportunity for growth. He said that Endeavour is ‘good at running pubs’ and believes there is significant growth that can be made most immediately through increasing the earnings of its existing portfolio.

The business acquired five new hotels this year, including the Terrey Hills Tavern, and renewed rentals on 26. Of its more than 12K poker machine fleet, the business updated more than 500 gaming machines.

Mr Gannon said that Endeavour X – the digital arm of the business – and Pinnacle Drinks are segments within the business where he believes there are big opportunities for longer term growth.

The business will pay a fully franked final dividend of 7.0 cents per share to its more than 450k shareholders.