Higher shelf prices underpin 3.6pc Coles first quarter sales increase

afr.com:

Coles says its 3.6 per cent rise in first quarter sales to $10.25 billion has been underpinned by its supermarket business, with customers eating at home and looking for special offers amid pressure on household budgets.

Supermarkets revenue gained 4.7 per cent to $9.2 billion for the 13 weeks to September 24. Excluding tobacco sales – which continued to decline in line with industry trends – sales increased by 5.9 per cent.

Comparable sales grew by 4.6 per cent in the first quarter, the company said, a marked slowdown from 6.8 per cent the fourth quarter of 2023.

Rival Woolworths on Wednesday reported comparative sales growth of 5.5 per cent from 6.4 per cent in the June quarter of 2023.

Coles Group CEO Leah Weckert says shoppers are seeking out value. Louie Douvis

Coles said prices increased 3.1 per cent in the three months to the end of September, compared with a 5.8 per cent increase in the last quarter of the previous financial year. The lower inflation was due to falling prices in meat, seafood and for baked goods.

Fresh produce price increases also continued to moderate. But inflation remains elevated at 5.7 per cent primarily driven by farmgate milk prices and higher commodity prices, including cheese, eggs and oil, Coles said.

The nation’s second-largest grocer reported a 9.4 per cent increase in revenues from its own-brand products, the fourth consecutive quarter of growth, with sales reaching $3.2 billion. Customers also continued to shift to healthier options with Coles Own Brand health and lifestyle product sales growing by almost 30 per cent.

Coles Liquor revenue increased by 1.8 per cent to $851 million in the quarter, helped by new store openings and online sales – which rose 32.2 per cent.

Coles chief