Coles Surges Over 8% on Solid FY25 Result

Highlights:

• Coles Group Limited (ASX: COL) shares jumped 8.5% to $22.50 at the time of writing after posting FY25 results driven by strong supermarket performance.
• Revenue rose 1.8% to $44.3 billion, with supermarket sales up 2.4% and e-commerce surging 24.4%.
• FY26 outlook remains positive, with supermarket revenue up 4.9% in the first eight weeks and continued benefits expected from automated warehouses.

Coles Group Limited (ASX: COL) shares jumped more than 8% to $22.50 at the time of writing, after the supermarket and liquor giant posted its FY25 results, showcasing resilience despite rising financing costs.

FY25 Financial Performance

Coles reported total revenue of $44.3 billion, up 1.8% from last year. Underlying EBITDA climbed 7.5% to $4.05 billion, while underlying EBIT increased 2.2% to $2.2 billion. However, underlying net profit after tax slipped 2.4% to $1.18 billion due to higher financing costs, which rose 22.4% to $541 million. Statutory net profit declined 3.5% to $1.08 billion. The board declared a final dividend of 32 cents per share, keeping the payout steady, while the total annual dividend rose 1.5% to 69 cents per share.

Supermarket Division Drives Growth

Supermarkets remained the standout performer, with sales up 2.4% (4.3% on a normalised 52-week basis). Liquor sales, however, grew modestly at 1.1%. Supermarket EBIT rose 4%, or 8.3% on a normalised basis, as the gross profit margin improved 79 basis points to 27.5%. Customer satisfaction scores also increased across both supermarkets and liquor. E-commerce was a key driver, with online supermarket sales surging 24.4% and liquor e-commerce sales up 7.2%, supported by Coles’ transformation projects, including fully operational automated warehouses.

Outlook for FY26

In the first eight weeks of FY26, supermarket revenue rose 4.9% (7% excluding tobacco), reflecting strong volume growth. Liquor sales, however, remained flat, with tobacco legislation and black-market growth weighing on demand. Coles expects benefits from its automated distribution centre program and plans to open about 12 new supermarkets and 19 liquor stores while closing a few underperforming outlets. Despite modest profit growth, Coles’ strong customer focus, digital investments, and supply chain upgrades position it for steady, long-term resilience.

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