Metcash has released its financial results for the half year ended 31 October 2022, with total liquor sales up 11.6% to $2.4billion.

The company said the result reflected a recovery in sales to on-premise customers post lockdowns and continuation of strong demand in the retail network.

Wholesale sales grew across both the retail network and contract customers supported by continuation of the increased preference for local neighbourhood shopping and at-home consumption.

Group CEO Doug Jones said: “The increased preference for local neighbourhood shopping continues to be seen in our strong sales performance, with shoppers recognising and enjoying the increased competitiveness, differentiated offer and relevance of our network of independent stores. Feedback from our retailers is that many shoppers have now changed their shopping habits to include local grocery, liquor and hardware stores.” 

Wholesale sales to the IBA banner group increased 1.2% (+25.7% 3yr basis) despite retail sales in the prior comparative period benefiting significantly from extensive lockdowns. Sales to IBA on-premise customers increased 47.8% due to the cycling of lockdowns, growth in underlying demand and new customers.

Liquor EBIT increased $5million or 11.3% to $49.3million, reflecting the contribution from strong sales growth, which the company said more than offset the impact of additional fuel, freight and labour costs.

The strongest performing categories

RTDs and spirits were the strongest growth categories, and wine continued to perform well. Sales of owned and exclusive brands increased 14.7% as the business continued to leverage the acquisition of the Kollaras private label brands.

Jones said: “It has been another pleasing half for Metcash with strong sales and earnings growth in the face of higher inflation and while cycling the impact of extensive lockdowns in 1H22.

“Importantly, the business continued to build on its record performances post the onset of COVID, achieving exceptional growth over the past three years in all pillars.

“The increased preference for local neighbourhood shopping continues to be seen in our strong sales performance, with shoppers recognising and enjoying the increased competitiveness, differentiated offer and relevance of our network of independent stores. Feedback from our retailers is that many shoppers have now changed their shopping habits to include local grocery, liquor and hardware stores.”

Results for the first four weeks of the second half of FY23

Metcash reported total sales increased 8.9% in the four weeks after October 31, compared with the prior corresponding period reflecting continuation of strong demand across retail stores and on-premise customers.

Sales to IBA on-premise customers increased 20.3%, reflecting the cycling of a gradual return to on-premise consumption following the end of lockdowns and new customers.

Metcash liquor sales grow by more than $1billion