Australian retailer Metcash has issued a downbeat sales outlook for the coming six months, despite posting a jump in full-year profits.
The grocer said that profits for the 12 months to 30 April rose 12.4% to A$226.7m (US$187.9m), up from $202.5m last year.
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EBITDA totalled $415.4m, up 8.6%, while sales rose 4.9% to $11.5bn.
However, the company said that sales gains in the back half of the year had slowed as the sector began to feel the weakening impact of the Australian government stimulus package, low inflation and rising interest rates.
Metcash predicted that these increasingly difficult trading conditions would persist for the first six months of the current fiscal year, with no sign of easing until December.
“We are pleased with the result, as we continue to operate in a low inflation environment, the positive effects of last year’s government stimulus package have receded and interest rate increases have impacted on household budgets,” Metcash chief executive Andrew Reitzer said.
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By GlobalData“While current trading conditions remain subdued, we are confident of further growth in our earnings per share in the 2011 financial year, subject to economic conditions remaining stable,” he added.
