Coles Maintains Pace of Supermarket Sales Growth Despite Rival's Campaign

By David Winning

SYDNEY--Coles said it has maintained the pace of sales growth in its supermarkets despite a short-lived hit from rival Woolworths's promotional campaign featuring collectible Disney characters.

Coles said supermarket sales growth in the first eight weeks of the new fiscal year was consistent with what it achieved in the three months through June, which captured much of the impact of the Middle East conflict on customer behavior.

Management said fourth-quarter supermarket sales rose by 3.8% when tobacco is excluded, or by 3.3% on a comparable basis. Across fiscal 2026 as a whole, supermarket sales rose by 5.1% excluding tobacco.

Still, Coles signaled sales growth in recent weeks has been uneven due to competition with Woolworths, which is due to report on its fiscal 2026 performance and give a trading snapshot on Wednesday.

"In the first few weeks of FY27, sales momentum was well ahead of 4Q FY26, with a temporary moderation during a competitor's collectibles campaign in late July and early August," Coles said. "Following the end of the collectibles campaign, sales recovered quickly back to levels consistent with 4Q FY26."

Australian grocers are competing hard for shoppers, recognising that they turned more cautious when the Middle East conflict drove up fuel prices and stoked economic uncertainty. At the same time, supermarket suppliers and transport companies have sought to recoup additional costs of everything from freight to packaging.

The snapshot of recent trading was provided alongside a net profit of 1.09 billion Australian dollars (US$780 million) for the 12 months through June 28, up from A$1.08 billion in the 2025 fiscal year. Revenue totaled A$45.72 billion, up 2.8% from A$44.49 billion, and earnings before interest and tax, or Ebit, rose by 0.5% to A$2.09 billion.

Directors of the company declared a final dividend of 37 Australian cents a share, bringing the annual payout to 78 cents. That was higher than the total payout for fiscal 2025 of 69 cents.

"This performance is particularly pleasing given the challenging operating environment, including continued cost-of-living pressures, geopolitical uncertainty and greater regulatory complexity," Chief Executive Leah Weckert said.

She said Coles is now investing in its next phase of growth, including through an accelerated store opening and renewal program.

Write to David Winning at david.winning@wsj.com

(END) Dow Jones Newswires

August 24, 2026 19:25 ET (23:25 GMT)