Coles Myer, Australia’s second largest supermarket chain, is due to post H1 profits for 2000-2001 on 15 March but analysts do not expect the group to reach its predicted profit levels of A$294.5m. Profit is expected to slide to between A$225m and A$245m.
A month ago, Coles Myer slashed its full-year profit expectations to A$400m, because a tax hit of A$30m-50m would be essential to fix the difficulties at Coles Myer’s subsidiaries Target and Myer Grace Bros. The group has also toned down its plans for a A$220m share buyback.
Coles Myer has been suffering because of the tough trading conditions currently characterising Australia’s retail scene. A weakening domestic economy has meant that consumer spending has dampened. Like other clothing retailers, Coles Myer was also affected by the 10% Goods and Services Tax, implemented on 1 July last year.