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Coles posts 3.4pc rise in sales

Coles CEO Leah Weckert
As the supermarket sector faces heated criticism over claims of profiteering, Coles has released its latest revenue results. Picture : NCA NewsWire / Nicki Connolly

Sales at Coles edged higher in the third quarter, its latest results have revealed, as the supermarket sector faces heated criticism over claims of profiteering.

Unveiling its latest results on Tuesday, the supermarket giant reported that revenue from continuing operations rose to $10bn in the March quarter, up 3.4 per cent from the corresponding period a year prior.

The revenue was driven by an increase in supermarket sales, up 5.1 per cent to $9.1bn, with strong growth in the supermarket’s exclusive food and groceries products.

However, the result was dragged lower by turnover in the brand’s liquor division, which slipped 1.9 per cent to $786 million.

SUPERMARKET PRICES
Coles boss Leah Wecker unveiled the sales results on Tuesday morning. Picture: NCA NewsWire / Martin Ollman

Coles latest customer survey showed 30 per cent of its shoppers were cutting back on liquor purchases owing to heightened cost of living pressures, with shoppers opting for cheaper beverages such as sparkling wine instead of champagne and prosecco.

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Excluding tobacco, total supermarket inflation was down 1.9 per cent in the third quarter, as prices eased.

The disinflation was driven by falling prices in fresh food category, particularly apples and avocados, while meat prices, particularly lamb, also reduced costs for consumers.

Bakery inflation remained elevated due to wheat commodity prices, Coles said.

“We have delivered another solid sales result across our supermarkets this quarter, reflecting strong execution of our trade plans and our continued focus on delivering great value and great quality, alongside improved availability,” Coles chief executive Leah Weckert said.

COLES 2024 HY RESULTS
Inflation across Coles products continued to ease in the March quarter. Picture: NCA NewsWire / Gaye Gerard

Sales over the quarter were driven by discounting over the Summer period as well as trade events across Australia Day and Valentine’s Day.

Turnover was also supported by strong trade in the lead-up to Easter, with the long weekend falling fully in the March quarter this year.

Coles’ eCommerce sales also climbed, up 34.9 per cent to $856 million, bolstered by its Home Delivery and Click & Collect segments.

The market update comes amid intense scrutiny on Coles and its larger competitor Woolworths over accusations that the chains have unreasonably inflated their prices during the current inflation squeeze.

The allegations have prompted a wave of federal and state inquiries into competition in the grocery sector, alongside reviews of the relationship between retailers and their suppliers.