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Metcash Warns on First-Quarter Results

Metcash staff IGA Mitre 10 Cellar 725 x 500.jpg

Australia's Metcash has warned that Q1 sales for the three months ended July 2019 at its IGA supermarket chain and hardware stores are likely to be weak, following the loss of a key Home Timber and Hardware customer and a slow-growing market.

Metcash is a wholesale supplier to the IGA, Mitre 10, Home Timber and Hardware chains, as well as Cellarbrations and Thirsty Camel (bottle shops).

The company made the announcement at its annual general meeting on Wednesday, advising of a decline in hardware sales of 4.4% when compared with the same quarter in 2018.

The company's supermarket wholesale sales dropped by 0.5% during the same reporting period, while the liquor division's sales increased by 0.7%.  Total food sales increased by 0.6%

For the 2019 financial year, revenue increased to $12.6 billion, hardware sales declined by 0.9% and underlying profit fell by 3% to $210 million.

CEO Jeff Adams said over the next two years, Metcash would cut $50 million in costs as part of its 'MFuture' strategy, which aims to offset inflationary impact and refine store offerings.

Robert Murray, Chairman, said: "While our markets remain challenging, we are encouraged by the confidence of our independent retailers in the future and their willingness to continue to invest in their stores,".

Source : Insight DIY Team

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28 September 2019

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