Australia’s Coles posts slower Q1 comparable sales on lower shelf prices
2024.10.30 19:04
(Reuters) -Australia’s Coles saw a slowdown in comparable sales in the first quarter on Thursday due to lower shelf prices for its products, even as it beat market estimates for group sales.
Supermarket duopoly Coles and larger rival Woolworths are under pressure to cut shelf prices as they face wide-ranging criticism over a cost of living crisis in Australia.
The country’s second-largest grocer posted a drop of 122 basis points in comparable sales to 2.4% for the 13 weeks to Sept. 29, from 3.6% in the prior corresponding period.
Coles, however, posted a 2.9% jump in first-quarter sales revenue to A$10.55 billion ($6.94 billion), higher than a Visible Alpha consensus of A$10.51 billion.
That compares with group sales revenue of A$10.25 billion recorded a year earlier.
“Cost of living remains a challenge for many of our customers, and we are focused on helping them find value in our stores through weekly specials, value campaigns, Flybuys and exclusive brands,” said Coles Group (OTC:) CEO, Leah Weckert.
The supermarkets division shoppers made value of promotional discounts and giveaways for the Melbourne-headquartered retailer, while its e-commerce division saw a jump in revenue with newer features and developments.
The grocer, which is currently under trial by the national corporate regulator for allegedly misleading customers, separately announced an agreement to construct its third automated distribution centre in Truganina, thereby taking its capital expenditure expectations to A$1.3 billion for fiscal 2025, compared with its previous guidance of A$1.2 billion.
($1 = 1.5211 Australian dollars)
