Mayank Bansal, CFA
Mayank Bansal is a CFA Charterholder and heads the Equity Research team at Kapitales Research, with over 5 years of experience analysing global equity markets. He leads fundamental, data-driven research combining rigorous financial analysis with macro trends.
Coles Expects Flat First-Half Supermarkets Earnings as Endeavour Reports More Moderate Customer Spending
Highlights
Introduction
Two of Australia's largest grocery and liquor retailers released first-quarter trading updates on the same morning. Coles Group Limited (ASX: COL) updated its first-half profit view for its main division, now expecting Supermarkets EBIT to be flat on the prior corresponding period.
Endeavour Group Limited (ASX: EDV) reported sales growth in both of its divisions. However, it said spending had been more moderate after a very strong July.
Coles Supermarkets Growth Slows Into the Second Quarter
For the 13 weeks to 27 September 2026, Coles Supermarkets sales revenue was AU$10,320 million, up 3.6%. Comparable sales growth came in at 2.7%, compared with 4.6% a year earlier.
Online sales rose 22.9% to AU$1,623 million, lifting eCommerce penetration to 15.7%. Headline Supermarkets inflation was 1.1%, and the company opened eight new supermarkets and completed seven renewals.
Total Group sales revenue increased 2.2% to AU$11,209 million. Coles said strong online growth and new and renewed stores were partly offset by heavier competitive and promotional activity.
Fuel Costs Weigh on the Earnings Outlook
Coles said cost-of-living pressures and heavy promotions by competitors continued to shape customer behaviour in the opening four weeks of 2Q27. Supermarkets sales growth over that period slowed from the first-quarter pace, the company said.
It also expects extra fuel-related costs across 1H27 versus the prior corresponding period, after fuel prices rose over the past two months. On that basis, Coles now expects first-half Supermarkets EBIT, excluding significant items, to be flat against the prior corresponding period.
The company has relaunched its Every Day Price program as part of targeted investment in value. It did not give a figure for the expected fuel costs.
Liquor and Other Revenue Decline at Coles
Coles Liquor sales revenue fell 1.3% to AU$831 million, matching the comparable decline. The company said the Liquor sales decline in the early weeks of 2Q27 was broadly similar to the first quarter.
Revenue in the Other segment dropped 62.8% to AU$58 million. This relates to a Product Supply Agreement with Viva Energy Group, which expires in November 2026.
Endeavour Says Spending Has Eased Since July
Endeavour reported Group sales of AU$3,178 million, up 2.8%, for the 14-week period ending 4 October 2026. Retail sales rose 3.0% to AU$2,575 million, while Hotels sales increased 1.9% to AU$603 million.
The company said Retail growth reflected a very strong July, followed by more moderate consumer spending. It added that promotional intensity remains elevated, especially online, and that Retail began cycling higher prior-year sales at the end of the quarter.
In Hotels, gaming revenue was flat on the prior year. Endeavour said growth in that division moderated as rising cost-of-living pressure, with fuel prices among the factors, affected discretionary spending.
How the Shares Traded
Coles shares were at AU$20.96, down 10.7%, with about 3.67 million shares traded. Endeavour shares were at AU$3.335, up 2.6%, on volume of roughly 1.49 million shares.
What Investors Should Watch
Conclusion
Both companies grew first-quarter sales, but each described shoppers as more careful with their spending. Coles has now tied that environment, together with higher fuel costs, to a flat first-half profit outlook for Supermarkets.
Their first-half results will show how the Christmas period affected those trends.
Note- All data presented is based on information available at the time of writing.
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