Metcash Limited reported FY26 sales revenue of $17.35 billion, a marginal 0.2 percent increase on the prior year, while underlying EBITDA grew 1.9 percent to $761.7 million. When including charge-through sales, group revenue reached $19.63 billion, up 0.7 percent, demonstrating modest but positive momentum across the distribution business despite a challenging operating environment characterized by softer consumer demand and persistent inflationary pressures.
The headline profit numbers mask a stronger underlying story. Reported underlying profit after tax fell to $268.8 million from $275.5 million, and earnings per share declined to 24.5 cents from 25.4 cents. However, these figures were impacted by one-off strategy and integration costs totalling $12.4 million. Stripping out these items, EBITDA growth would have been 3.5 percent and EBIT would have increased 1.6 percent on a normalised basis. For investors, this distinction matters, as it reveals that core business performance was more resilient than the reported figures suggest, with underlying operational improvements offsetting cost pressures that the company is managing through strategic initiatives.
The Food pillar delivered the standout performance, with EBIT increasing 5.4 percent to $261.8 million, or 7.0 percent on a normalised basis. Excluding tobacco sales, the pillar achieved revenue growth of 5.4 percent on total revenue of $10.5 billion, a significant achievement that reflects improved competitiveness and a strengthened value proposition in a category that remains central to Metcash’s earnings profile. This performance provides confidence that the business can drive organic growth despite challenging macro conditions.
The Liquor pillar maintained resilience, growing revenue by 1.0 percent to $5.4 billion and lifting market share to 32.3 percent, though reported EBIT came in at $100.1 million, down slightly from the prior year. Management attributed this to softer first half trading that reversed in the second half as shopper demand for convenience offerings and localised promotions proved durable. The Hardware and Tools pillar expanded revenue by 4.3 percent to $3.7 billion, though reported EBIT of $177.3 million included headwinds from softer conditions in Victoria and Tasmania hardware retail stores, partially offset by continued strength in Total Tools.
Investors will be watching closely for guidance on dividend sustainability given the modest decline in underlying earnings, as well as updates on how the company intends to navigate ongoing cost pressures and consumer demand dynamics in the second half of FY27. The company’s ability to continue margin expansion through its Food pillar, while stabilising performance in Liquor and Hardware and Tools, will be critical. This announcement is price sensitive and has been flagged as material by the ASX.
View the full ASX announcement (PDF)
About Metcash Limited (ASX: MTS)
Metcash Limited is a wholesale distribution and marketing company based in Macquarie Park, Australia, specializing in grocery, liquor, and hardware products. The company supplies independent supermarkets, convenience stores, hospitality venues, and retailers under brands including IGA, Foodland, Mitre 10, Total Tools, and Cellarbrations. It operates in Australia and New Zealand with approximately 11,500 employees.
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