Metcash (MTS) H2 2024 earnings summary

Executive summary

• Delivered strong FY24 results with disciplined execution and diversification, achieving group sales revenue growth of 0.7% to $18.2bn, supported by strong cash generation and cost control.

• Maintained or grew market share in key segments: Liquor and Hardware strengthened, Food held steady, with private label sales up 15.5% and 26 new IGA stores opened.

• Completed strategic acquisitions including Superior Foods, Alpine Truss, Bianco, and full ownership of Total Tools Holdings to drive future growth.

• Underlying EBIT was $496.3m, down 0.9%, as Food and Liquor gains were offset by lower Hardware earnings and higher corporate costs.

• Statutory net profit after tax was $257.2m, down 0.7%, including $25.1m after-tax significant items.

Financial highlights

• Group revenue reached $18.2bn, up 0.7% year-over-year; underlying EBIT $496.3m, down 0.9%.

• Underlying profit after tax $282.3m, down 8.2%; reported profit after tax $257.2m, down 0.7%.

• Operating cashflow $483m; cash realisation ratio 102%.

• Earnings per share 28.3c (underlying), 25.8c (reported), down 3.7%.

• Total dividend 19.5cps, ~70% payout ratio.

Outlook and guidance

• First seven weeks of FY25: group sales up 2.2% (including Superior Foods), flat excluding acquisition.

• Food (ex-tobacco) and Liquor continue strong performance; Hardware outperforms market despite softness.

• Superior Foods performing strongly and winning new customers.

• Targeting ~$15m in additional annualised cost savings in FY25.

• Well positioned for future growth with diversified portfolio and recent acquisitions.