Metcash still struggling despite boost from liquor and hardware
Australia’s ASX-listed grocery wholesaler Metcash has reported a 20 per cent increase in profit after tax for the six months ended 31 October 2015.
The company has however said that whilst improvements in both liquor and hardware profits for the group, this was more than offset by the decline in food and grocery, which was impacted by the incremental investment price in the first half of the year.
In its announcement, Metcash said its sales revenue was up 1.4 per cent of AUD$6.6 billion when compared to the same period last year.
Metcash’s Food and Grocery sales rose by 0.7 per cent to AUD$4.5 billion.
“We continued to invest in the Group’s turnaround,” said Metcash CEO Ian Morrice.
“While we are still experiencing highly competitive trading conditions and price deflation, we are seeing evidence the Transformation Plan is producing positive results across the Group. Importantly, we have seen a continuing improvement in the sales trend for the Food and Grocery Pillar,” said Morrice.
“We have commenced “Working Smarter”, the next stage of the Group’s Transformation Plan, designed to reduce complexity, make it simpler for customers and suppliers to do business with Metcash and to reduce our cost of doing business,” Morrice said.
“In addition, we will look to develop future growth opportunities and invest in new channels. Recently we have begun exporting Australian product, sold direct to consumers in China through Alibaba’s online Tmall platform, Morrice stated.
Metcash’s projected future
Metcash said that it was confident its initiatives will strengthen its organisation and will return Metcash to a growth state.