Australian grocery wholesaler Metcash posted an increase in normalised profit for the first half of the year, boosted by strong wholesale sales.
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Normalised net profit for the six months ended 31 October increased 12.3% to reach A$109.2m (US$100.7m).
Wholesale sales increased 6.6% to reach A$5.6bn, despite significantly lower inflation in core grocery categories and deflation in many produce categories.
Metcash’s major division, IGA Distribution, boosted its comparable-store sales 6.4%. “IGA Distribution continues to be the powerhouse of the Metcash business and is performing well against competition from the two chains,” CEO Andrew Reitzer said.
EBITA reached A$189.9m, a 6.9% increase on last year. Operating leverage, however, was somewhat held back in the first half by significantly lower price inflation.
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By GlobalDataPerformance in the company’s Campbells Wholesale unit was hampered by large bad debt and soft foodservice and convenience market conditions.
The company raised its interim dividend 10% to 11 cents per share, payable 8 January.
