Endeavour Group saw its retail sales fall by 1.5% to $5.5 billion in the first half of FY25, during what it described as “challenging macro economic conditions”.

Endeavour Group Managing Director and CEO Steve Donohue said the result reflected subdued consumer spending in Q1 and an estimated $40 million to $50 million in lost sales due to the Victorian supply chain disruption that reduced stock availability in stores during the peak end-of-year trading period.

“Despite this disruption, detailed planning and execution from our team enabled the Group to deliver a strong trading performance in December,” he said.

“Dan Murphy’s achieved a record sales result for the week preceding Christmas and BWS recorded its best ever sales performance for the week preceding New Year’s Eve.

“Hotel sales grew by 3.3% to $1.1 billion with sales momentum increasing throughout the half. Pleasingly, higher sales
results were achieved across all four key business drivers [food, bars, gaming and accommodation].”

Group gross margin as a percentage of sales increased to 34.9% reflecting improvements in both Retail (11 bps) and
Hotels (16 bps).

In particular, Donohue said, a more tailored approach to Endeavour’s promotional program during the key cyber sales period enabled the retail business to deliver its most profitable Black Friday week ever.

Wine sales up for Pinnacle Drinks

It wasn’t all bad news for retail. Pinnacle Drinks, which creates and manages a portfolio of brands sold through Endeavour’s hotels, stores and on-demand services, recorded strong premium wine segment performance, with 18% sales growth.

Pinnacle launched 170 new products during the period, with K by Krondorf leading red wine NPD performance.

Wine made up 50% of sales for Pinnacle, with three quarters from premium and luxury segments.

Outlook for second half

Endeavour said sales growth for the first seven weeks of H2 was -0.8% for retail and +4.7% for hotels.

Retail sales in the first seven weeks have been impacted by ongoing effects of supply chain disruption. The Group said Hotel sales have accelerated in Q3.

“Renewals and upgrades to our EGM fleet are expected to underpin continued growth in Hotels,” Endeavour noted.

“We operate in resilient categories and we expect Retail market conditions to improve as inflation moderates. Our commitment to price and value leadership is expected to drive improved sales momentum in the second half. We are continuing to prioritise operating efficiency and cost savings.”

Coles Group reported last week that its liquor sales revenue in quarter three of FY24/25 rose 3.4% to $813 million, driven by strong Australia Day sales and a reset of its “value offer” to customers.

Endeavour Group awaits new CEO

Endeavour Group announced on 29 April that ex-Virgin Australia head Jayne Hrdlicka had been appointed as its new Managing Director and CEO, replacing Steve Donohue.

Hrdlicka will start on 1 January 2026 pending the receipt of all necessary regulatory approvals, with Ari Mervis continuing as Executive Chairman until her commencement.

Endeavour Group said that prior to her commencement, Hrdlicka has agreed to make herself available to meet frequently with the company, which will provide the Board and the Executive Chairman the opportunity to engage on key business and strategic matters as appropriate.

Industry verdict on new Endeavour Group CEO