Coles sales continue strong 4 year growth trend
In announcing its second quarter retail sales results for the 2012 financial year today, Wesfarmers has expressed pleasure with the continuing strong growth of its subsidiary Coles.
Coles is one of Australia’s two major supermarket groups.
Coles’ first half-year’s sales this financial year were $13.6 billion, a 4.9 percent increase on the previous year.
Wesfarmers’ managing director, David Goyder said, “Given a relatively tough retail environment and widespread deflation, I am pleased with the momentum with Coles, where business has recorded good sales growth in the second quarter”.
Mr Goyder noted that “Coles has reported its fourteenth straight quarter with customer numbers and units growing faster than sales”.
In a continued fourth year of its turnaround since Wesfarmers implemented management changes for Coles operations, Coles delivered comparable food and liquor store sales growth of 3.7 percent in the second quarter, and 4.4 per cent for the first half, “with underlying volume growth continuing strongly”, according to Mr Goyder.
The report said that volume growth for Coles has exceeded sales growth, which was attributed to the current glut in fresh produce. Continued investment in marketing of value was the basis of food and liquor deflation increasing to 2.4 percent in the second quarter. Deflation for the second quarter reflects an increase from deflation of 1.8 percent in the first quarter, resulting in deflation of 2.1 percent in its first half.
As reported earlier in Australian Food News, Coles has been taking advantage of the current fresh produce glut to plug a marketing message to the very profitable fresh produce sector. That strategy directly tackles the longstanding Woolworths “Fresh Food People” competitive proposition.
Coles Managing director, Ian McLeod says, “All of Coles’ businesses had made good progress in the second quarter and customers rewarded Coles for its continued investment in lower prices as part of our ‘Down Down’ campaign”.
Mr McLeod also says that Coles’ continued strong volume growth is pleasing and “has been driven by investment value, quality and service at a time when Australian families are looking to manage tight household budgets.”