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MTS - Metcash Limited

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MTS has taken the southwards direction once again and seems unstoppable. I still do not know who pays MTS when the IGAs vary on their prices, independently owned, some of them are just pathetic quality wise and storage wise even you pay the premiums. the exception is there on the Duncraig WA 6023 IGA - fantastically competitive, whereas IGA owned by the same owner at Darch/Perth looks pretty excepting you pay on an average 10% more than the Duncraig shop.
How MTS makes money from here?? DNH
 
Financial Review reported today

Metcash to lose part of 7-Eleven contract
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Sue MitchellSenior Reporter
Oct 10, 2019 — 12.00am

Metcash is in negotiations with one of its biggest customers, convenience chain 7-Eleven, to salvage long-term supply contracts, just weeks after losing its $270 million a year agreement with Drakes Supermarkets.

7-Eleven, which has 700 stores around Australia and annual sales of more than $3.4 billion, is changing its supply chain to support the company’s growth and focus on fresh food, and has put contracts for the supply of food and groceries up for tender.

As a result of the first tender, 7-Eleven decided to source the majority of the products for its eastern seaboard stores directly from suppliers and its current contract with Metcash will expire in August 2020.

7-Eleven is seeking tenders for the balance of the products it needs for eastern seaboard stores. Metcash is participating in the request for proposal and is also in discussions to supply 7-Eleven’s stores in Western Australia.

A Metcash spokesman confirmed on Wednesday that negotiations were still underway.

"Metcash is in discussion with 7-Eleven with regard to retaining the volumes for the products we currently supply," the spokesman said.

"We are aware that 7-Eleven is changing its supply model which will include the daily supply of fresh products to their stores. Metcash is not currently, nor will it be, the supplier of fresh items to 7-Eleven."

Metcash's contract with 7-Eleven is estimated to be worth more than $350 million in annual sales, larger than the $270 million a year Drakes supply contract.

However, the margin on sales is lower so the loss of the contract will have less impact on Metcash's earnings. Citigroup analyst Bryan Raymond has estimated the contract could cost Metcash about $14 million in lost earnings, while the loss of the Drakes contract is expected to crimp earnings by about $16 million.

Metcash has been supplying 7-Eleven since 2005, when the convenience store chain had about 350 franchised stores. The initial contract, worth about $200 million a year, was extended in 2011 when 7-Eleven bought about 230 Mobil outlets, which boosted the agreement by about $140 million a year.

7-Eleven, which is owned by the Withers and Barlow families, has grown significantly in recent years and now has the scale to negotiate more competitive trading terms with food and grocery suppliers.

According to the most recent accounts filed with ASIC, 7-Eleven's sales rose 21 per cent to $3.4 billion in the 12 months ending June 2018, boosted by new store openings and strong same-store sales growth in merchandise and fuel.

"7-Eleven is growing strongly, and while our industry leading supply chain has served us well, it needs to evolve to enable our future growth," said chief executive Angus McKay.

"Our new supply chain eco-system will enable us to expand to meet our projected volumes and store network growth, and will reduce complexity for our stores,” he said.

Metcash is under growing pressure to reduce prices to stop independent retail customers and convenience chains from sourcing directly from suppliers or moving to self-supply.

As reported in The Australian Financial Review last month, Metcash's second-largest independent retail customer, Drakes Supermarkets, plans to go into competition with Metcash by supplying other independent supermarkets once it has bedded down a $125 million state-of-the-art automated distribution centre it opened this month in Adelaide.

Metcash has attempted to stop further independent retailers from leaving by signing long-term (10 year and five year) supply contracts and investing in stores, distribution centres, range and prices.

673
 
kashtrade said:
Can Metcash outperform Woolworths via a spin-off? thoughts? https://www.fool.com.au/2020/01/16/can-metcash-outperform-woolworths-via-a-spin-off/
Click to expand...
Was there a spin off from MTS ?
I could see a CR to pay off debts solely @$2.80 against current MP @$2.4.
I often wonder what sort of calculation does the insto undertake to commit $300 M to pay some company's debts. Ironically people like us also buy shares of those instos. That is a pretty disgusting story because the few of the key lead brokers/ fund managers harness a hefty commission following the CR.
Reading through the investor report, I could not find any attractive lines which could have motivated the investors to invest ?? Smooth talking marketing ??

nhttps://www.asx.com.au/asxpdf/20200420/pdf/44h2hfnb99lv63.pdf
 
Miner said:
MTS has taken the southwards direction once again and seems unstoppable. I still do not know who pays MTS when the IGAs vary on their prices, independently owned, some of them are just pathetic quality wise and storage wise even you pay the premiums.
Click to expand...
The 'third force'!! Corner store equivalent, and priced accordingly. They have never gained traction, and sometimes the best research is "eyeball and wander". Never have I seen a $200 of groceries wheeled out of an IGA store, their peak times are 5-7pm and it's 2-3-4 items, sub $30 what's for tea type purchases.

(Used to hold but that was pre-GFC)
 
but doing well with Covid-times. I guess if you can't go more than 5km, then the 'local' becomes the only option

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 Significant growth in sales volumes across all Pillars
 Strong earnings growth with underlying Group EBIT up 30.4% to $203.0m
 Group revenue increased 12.2% to $7.1bn and 12.3% to $8.1bn including charge-through sales
 Strong sales growth underpinned by investment in MFuture initiatives
 Food –move to ‘shop local’ and the improved competitiveness of retailers resulted in an increase in both foot traffic and average basket size
 Liquor –high levels of demand across the retail stores more than offset the adverse impact of trading restrictions on ‘on-premise’ customers
 Hardware –elevated demand from DIY customers and a return to growth in Trade
 Underlying profit after tax increased 43.0% to $129.6m
 Statutory profit after tax of $125.1m (1H20: Loss of $151.6m1)
 Strong cash generation and efficient management of working capital
 Positive operating leverage supported through efficient management of costs while investing in COVID Safe work practices
 COVID related costs have been well managed and were ~$8m in 1H21
 Continued investment in growth opportunities, including the acquisition of Total Tools and the Kollaras private label business
 Sales momentum has continued into 2H21 with strong growth in first five weeks
 Increase in interim dividend to 8.0 cents per share (1H20: 6.0 cents)
 
Supermarket, hardware and liquor supplier Metcash produced a strategy and trading update to the market yesterday. Metcash revealed solid sales data for the second half of its financial year so far but more importantly it outlined tweak to its dividend policy that will see total payout to shareholders rise to 70% of underlying profit after tax from the present 60%. The company said in the update that the higher dividend payout ratio will start in the current financial year and the board will ensure the dividend remains fully-franked.

Good news of that type would normally see the share price rise. But .... the shares fell through the day to be down nearly 4% at $3.39. That was in a market that ended up 0.6%. Actually, Metcash shares were up 1.3% in early trade, so the crunch on the day was larger than it looks – more than 5%.

That’s despite what was an upbeat trading update. Metcash reported strong sales momentum for all business segments so far in the second half of 2021. Supermarket, hardware and liquor sales have all jumped by double digits compared to the prior corresponding period. Metcash told investors in the strategy update that it has seen a shift in consumer behaviour that has benefited its retailer network and is generating “strong sales momentum”. Metcash added it has made “additional investment in shopper retention”.
  • In the food division, supermarket sales increased 14.4% in the first four months of the second half of 2020-21 (November 2020 to February 2021 as Metcash’s year runs May to April), compared to the same period in 2019-20. Food sales were up 4.1%, or 14.1% excluding the impact of losing a 7-Eleven tobacco supply contract.
  • In its Mitre10 hardware division, sales were still strong, up 31.6% in the November to February period, and in liquor sales are up 19.6% “with continued strong sales in the retail network more than offsetting the adverse impact of COVID-19 restrictions on ‘on-premise’ customers”.
  • It said liquor sales to Independent Brands Australia (IBA) were up nearly 24%. This includes retailers like Cellarbrations, Thirsty Camel, The Bottle-O, and Porters Liquor.
But it did warn that the growth would disappear this month and in April when comparisons are made with the same months of 2020 which saw a surge in grocery sales as the lockdowns started across the country. In fact growth could fall on a comparison with the same months in 2020 and perhaps for May as well. As well corporate costs have tripled to $15 million due to higher insurance and staff bonuses.

So the shares were sold off, even though sales growth hasn’t tanked and dividends will be juiced with a higher final for the year.

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Ally Selby: And welcome to Livewire Markets and Buy Hold Sell. I am Ally Selby. And as many of you know, markets have been off to a rough start in 2022, with the S&P/ASX 200 down around 7 per cent.

So, which companies can help you sleep at night and weather the volatility ahead? Glad you asked. Today we are joined by Bruce Williams from Elston and Simon Conn from IML.

Ally Selby: We asked our fundies to bring along one all-star Aussie company that they think can weather the volatility ahead this year. Simon, I might start on you. What have you brought for us today?

Metcash​

Simon Conn: Our focus is on the mid and small-cap sector, so I’ve picked Metcash today. We think it’s an underappreciated franchise, and a business that’s no doubt benefited from COVID-19, but I think that’s delivered enduring benefits to their food business. But also their liquor business has been growing and is a very resilient business. But really it’s the hardware business, where they position themselves as the second player in the hardware, retail and wholesale markets that we think is underappreciated by investors.

Their acquisition of Total Tools looks really well priced. They bought that prior to COVID-19, effectively on about three-and-a-half times EBITDA. A business that’s grown very well through COVID-19. But we think as the franchisees and the operators in those networks reinvest in their stores with the increased profitability they’ve generated, the local consumers are spending more in their local communities, and we think that will continue to a large extent, going forward. And all of those stores have been refurbished. And again, the hardware business, I think can continue to do well going forward. And the thing about Metcash is it’s really attractively priced on 13 times, and a yield of over 5 per cent, with a really strong balance sheet. For us, it looks like a standout in the market, where a lot of stocks look pretty fully priced.
 
In the first half of the 2023 financial year despite increased supply chain and labour cost pressures:
  • Group sales rose 8.9 per cent in the 17 weeks to 28 August.
  • Supply chains and stock availability has improved.
  • Food sales increased 4.3 per cent and supermarket sales climbed 3.4 per cent (both inclusive of tobacco)
  • Hardware sales gained by 19.5 per cent (inflation in trade sales was emphasised)
  • Liquor sales added 11.5 per cent.
 
  • The company declared an interim dividend of 11.5¢ a share, up 9.5 per cent on FY22
  • reported a 10.3 per cent increase in underlying EBIT to $255.1 million.
  • Revenue rose 8.2 per cent to $7.7 billion for the six-month period.
  • MTS reported a 9.1 per cent increase in underlying profit to $159.9 million. On a statutory basis, profit after tax was $125.7 million.
  • In the second half, the company said group sales were up 6.2 per cent in the first four weeks.
  • Metcash said while supply chain challenges had improved, they continued to be a risk in the next six months along with additional fuel, freight and labour costs.
 
Dona Ferentes said:
  • The company declared an interim dividend of 11.5¢ a share, up 9.5 per cent on FY22
  • reported a 10.3 per cent increase in underlying EBIT to $255.1 million.
  • Revenue rose 8.2 per cent to $7.7 billion for the six-month period.
  • MTS reported a 9.1 per cent increase in underlying profit to $159.9 million. On a statutory basis, profit after tax was $125.7 million.
  • In the second half, the company said group sales were up 6.2 per cent in the first four weeks.
  • Metcash said while supply chain challenges had improved, they continued to be a risk in the next six months along with additional fuel, freight and labour costs.
Click to expand...
I was gathering MTS performance will be better with my wife's focus on shopping through IGA than standing on Wooly and Coles, the volume of goods people are buying at IGA and excepting vegetables, prices at my local IGA (not all) stores is becoming competitive and many a times better than the same from super markets.
With Christmas time IGA would get leverage not only on groceries but also on alcohols
DNH
 
Miner said:
I was gathering MTS performance will be better with my wife's focus on shopping through IGA than standing on Wooly and Coles, the volume of goods people are buying at IGA and excepting vegetables, prices at my local IGA (not all) stores is becoming competitive and many a times better than the same from super markets.
With Christmas time IGA would get leverage not only on groceries but also on alcohols
DNH
Click to expand...
indeed do not forget the alcohol , i notice the local strip mall , has acquired an IGA franchised liquor outlet ( fairly recently )
 
Since acquiring a modest position in Metcash we have been shopping at IGA and other Metcash outlets (especially Total Tools, I spend a freakin fortune there).

I kinda like the philosophy (and we do have the shxts with Woolies and Coles) and will buy more MTS when the price is right.
 
Your fortune is getting reinvested (LOL). On a serious note, I buy on specials . For example Digestive biscuit (Mcvites) are often available at $2.99 at IGA where as normal prices in Wooly and COles is $4.50 excepting they throw the discount. Milk is same price. Potato is cheaper at IGA, Eggs are cheaper by $2 each carton. Yoghurt is often cheaper at IGA than Coles/W. Dish Washing powder I buy from Red Dots but washing rinse from IGA. Other stuff excepting vegetables (often come from Asian shops to my home any way) are dearer both in IGA and Woolies. Coffee and Tea- not a daily item so buy when it is reduced at IGA. So smart shopping is the key to reinvest the fortune on IGA shares
wayneL said:
Since acquiring a modest position in Metcash we have been shopping at IGA and other Metcash outlets (especially Total Tools, I spend a freakin fortune there).

I kinda like the philosophy (and we do have the shxts with Woolies and Coles) and will buy more MTS when the price is
Click to expand...
 
ASX Announcement –

Metcash Limited FY24 Half Year Results

Metcash Limited (ASX:MTS) today released its financial results for the first six months of FY24 ended 31 October 2023. Highlights
• Further sales growth consolidates recent extraordinary sales performance
• Strong earnings performance in Food and Liquor
• Hardware retail network resilient
• Good cost management
• Outstanding cash result
• Well positioned with platform and resilience for future growth and strong returns
• Significant growth opportunities – footprint and M&A Financials
• Group revenue increased 1.3% to $7.8bn and 1.6% to $9.0bn including charge-through1
• Group underlying EBIT decreased 3.4% to $246.5m
• Underlying profit after tax2 decreased 10.9% to $142.5m
• Statutory profit after tax increased 12.2% to $141.0m
• Underlying EPS 14.7 cps, Statutory EPS 14.5 cps
• Operating cashflow up 143% to $217.7m (cash realisation ratio ~92%)
• Interim FY24 dividend of 11.0 cps Commentary Group CEO, Doug Jones said: “The diversity and resilience of our portfolio of businesses are clearly evident in the first half results for FY24. Standouts for the half include continuation of sales growth on a very strong comparative period, and in more challenging conditions, as well as the outstanding cash performance.
Sales growth was delivered in all pillars and in our independent retail networks, with the differentiated offer of the independent network and its compelling value proposition continuing to resonate with shoppers, builders and tradespeople.
Our independent retail networks are healthy, and importantly they are continuing to reinvest to further lift their overall store quality and competitiveness.
Metcash Limited ABN 32 112 073 480 1 Thomas Holt Drive Macquarie Park NSW 2113 Australia
2 Our Food and Liquor pillars performed particularly well, delivering increased earnings on the strong comparative period. It was also pleasing to see our Supermarkets business return to volume growth in the second quarter as inflation slowed. In Hardware, sales in both our Independent Hardware Group (IHG) and Total Tools networks continued to be resilient in a more challenging market.
Sales growth was delivered in both retail networks, however increased cost pressures and a further reduction of inventory in the IHG retail network weighed on Hardware’s earnings for the half.
Last month we announced that our ownership in Total Tools Holdings would be increasing from 85% to 100%.
Total Tools has been a great acquisition for us.
The business, including our network of retail joint venture stores which now represents around half of network sales, has delivered significant value for shareholders. Also announced last month, was the positive news that put option arrangements with our Total Tools joint venture partners were being reset to keep them in the business longer.
The reset allows us to retain the experience and enthusiasm of these great store operators for longer than anticipated, and is a reflection of their confidence in the continued growth of those businesses. Many are looking to reinvest in their stores or open new stores and want to remain both invested and engaged in their ongoing success.
Pleasingly, Metcash’s focus on further improving its ESG credentials was recognised in the recent Dow Jones Sustainability Index assessment, with the Company lifting to the 89th percentile of its international sector (FY23: 87th percentile).

Looking forward, Metcash’s continued transition to a bigger, stronger and more diversified Group provides the Company with an ideal base for future growth and strong returns through the cycle.
We remain well positioned with solid fundamentals in all our pillars, healthy and supportive retail networks, leading market positions, a strong financial position and an extensive pipeline of strategic growth opportunities,” Mr Jones said. Results Overview Group reported revenue, which excludes charge-through sales1 , increased 1.3% to $7.8bn (1H23: $7.7bn). Including charge-through sales1 , Group revenue increased 1.6% to $9.0bn (1H23: $8.9bn) with growth in all pillars on their very strong sales performance in 1H23.
Group underlying EBIT decreased by 3.4% to $246.5m due to earnings growth in Food and Liquor being more than offset by lower earnings in Hardware and increased corporate costs.
All pillars were supported by solid demand, good operating discipline and the success of strategic initiatives and acquisitions. The Food pillar continued to perform very well delivering earnings growth of 3.6% to $101.7m, reflecting the strong trading performance and improved leverage.
The differentiated offer and improved competitiveness of our independent network is continuing to provide an attractive value proposition for shoppers.
Hardware earnings declined 5.1% to $110.6m with continued earnings growth in Total Tools offset by a decline in IHG earnings. While sales in both the IHG and Total Tools retail networks have been relatively resilient in a more challenging market, increased cost pressures had an adverse impact on first half earnings.
The Liquor pillar has again performed strongly with earnings increasing 3.0% to $50.8m supported by continued strong demand from retail customers and improved leverage.
Group underlying profit after tax2 decreased 10.9% to $142.5m, reflecting lower earnings in Hardware and increased finance costs. Statutory profit after tax increased 12.2% to $141.0m.
The cash performance of the Group was a standout this half with operating cashflow increasing $128.1m to $217.7m (1H23: $89.6m), with a cash realisation ratio of 91.9% (1H23: 36.5%).
This reflects a reduction in incremental investment in working capital, a reduction in the effective tax rate and lower cash costs associated with significant items.
Net debt at the end of the financial year was $329.4m (1H23: $349.6m).
The Group had undrawn debt facilities of ~$670m at the end of the first half, with an additional $200m of committed facilities added in November 2023 3 to help facilitate future growth opportunities.
The debt leverage ratio3 at the end of 1H24 was 0.59x (1H23: 0.65x).
The strong cash performance and financial position of the Group supported the determination to pay an interim dividend of 11.0 cents per share fully franked, which is in line with the Company’s annual target payout ratio of ~70% of underlying profit after tax.
Review of Trading Results Food Total Food sales (including charge-through1 and excluding tobacco) increased 5.7%, with strong growth in both Supermarkets and Convenience.
The increase was 0.6% including tobacco sales.
In Supermarkets, wholesale sales excluding tobacco increased 6.0% underpinned by further improvement in network competitiveness and inflation.
The differentiated offer of the retail network, supported by continued improvement in prices, ranges and store quality resonated with shoppers, resulting in the retention of IGA in their shopping repertoire.
Foot traffic into stores increased, but items per basket decreased reflecting cost of living pressures on household grocery budgets.
Sales volumes returned to growth in the second quarter and were close to flat for the half.
Wholesale price inflation moderated through the half with inflation4 of 7.7% in Q1 and 5.3% in Q2, and 6.5% for the half.
Retail like for like5 sales growth in the IGA network was +2.8% ex-tobacco.
The network remains healthy, confident and continues to reinvest.
There were 18 new stores opened in the half and eight closures.
Tobacco sales declined 12.2% due to an acceleration in illicit trade and the trend to alternatives.
Food EBIT increased $3.5m or 3.6% to $101.7m reflecting the strong trading performance ex-tobacco, continued strong support from suppliers and the effective management of costs.
Food EBIT also includes a one-off restructuring cost of $2.8m related to the alignment of capabilities and resources to support the acceleration of strategic growth initiatives. The Food EBIT margin6 increased 6bps to 2.15% reflecting the strong sales performance ex-tobacco and change in sales mix.
Hardware Hardware sales(including charge-through1 ) increased 2.9% to $1.8bn, with growth in Total Tools offsetting a slight decline in IHG.
Excluding acquisitions, sales declined 1.1%. Salesin the combined IHG and Total Tools retail networks were resilient in more challenging conditions, increasing 2.1%. In IHG, sales were broadly flat at $1.43bn with wholesale sales down 1.9%, reflecting growth in DIY being more than offset by a decline in Trade.
Scan sales for the IHG retail network7 increased 0.7% (LfL flat) with DIY +1.4% and Trade +0.3%.
There was a further reduction in inventory levels in the retail network due to supply availability returning to more normal levels.
In Total Tools, sales increased 18.2% to $350.9m largely reflecting the impact of additional majority-owned joint venture stores.
Excluding these additional stores, sales decreased 2.6%. Retail network sales8 for Total Tools increased 4.1% to $589.7m with a softer retail market evident in the second quarter.
Foot traffic was down in the half, but customer conversions increased driven by Total Tools’ competitiveness and leading market position. Hardware online sales declined 7.2% to represent 5.1% of non-account sales.
Hardware EBIT decreased $6.0m or 5.1% to $110.6m with increased earnings in Total Tools more than offset by a decline in IHG earnings. Excluding acquisitions, the decrease was 11.8% which reflects lower sales volumes and increased cost pressures.
EBIT was adversely affected by regulatory cost increases (primarily in Victoria), higher labour costs (including the impact of Fair Work), higher occupancy costs and other cost inflation.
Lower sales volumes incorporate a one-off adverse sales impact in Total Tools associated with the transition of its exclusive brands inventory to the new Ravenhall Distribution Centre in Victoria. 4 In IHG, EBIT decreased 12.2% to $61.3m and the wholesale margin was 2.9%.
Total Tools EBIT increased $2.5m or 5.3% to $49.3m. Excluding acquisitions, EBIT decreased 8.1%, and includes the adverse impact associated with its transition to the new Ravenhall Distribution Centre.
The Hardware EBIT margin6 was 6.2% (1H23: 6.7%) with IHG 4.3% and Total Tools 14.0%.
Liquor Total Liquor sales (including charge-through1 ) increased 2.4% to $2.5bn with continued growth in sales to independent retail customers despite a more challenging market.
Wholesale sales to retail customers increased 2.8%, underpinned by a continuation of the increased preference for local shopping and the at-home consumption trend.
The value offered by the independent retail network through convenience, tailored ranges, competitive prices and local friendly service continued to drive the strong performance.
Sales to on-premise customers declined 2.6% in line with market trends.
Higher cost of living pressures led to more shoppers switching to lower priced value choices with the beer and RTD categories delivering the highest growth.
Liquor EBIT increased $1.5m or 3.0% to $50.8m reflecting the contribution from the strong trading performance, improved leverage and good cost management.
The EBIT margin6 for Liquor increased one basis point to 2.04%. Financial Position Group operating cashflow increased $128.1m to $217.7m (1H23: $89.6m) with a cash realisation ratio9 of 91.9% (1H23: 36.5%). This reflects a reduction in incremental investment in working capital, a reduction in the effective tax rate and lower cash costs associated with significant items.
The Group had net investing outflows of $71.1m, including capital expenditure of $57.2m and acquisitions of businesses of $19.0m. The business acquisitions were predominantly in the Hardware pillar including the acquisition of an additional five joint venture stores in Total Tools.
Net debt at the end of the financial year was $329.4m (1H23: $349.6m).
The Group had undrawn debt facilities of ~$670m at the end of the first half, with an additional $200m of committed facilities added in November 2023 to facilitate future growth opportunities.
The debt leverage ratio3 at the end of 1H24 was 0.59x (1H23: 0.65x).
Dividends The strong cash performance and financial position of the Group led to the Board determining to pay an interim dividend of 11.0 cents per share fully franked, which is in line with the Company’s annual target payout ratio of ~70% of underlying profit after tax.
The record date is 15 December 2023 and payment is on 30 January 2024. Metcash reactivated its Dividend Reinvestment Plan (DRP) in June 2023 to provide flexibility for shareholders resident in Australia and New Zealand to reinvest in Metcash cost effectively, while also delivering incremental support and flexibility for Metcash to pursue attractive growth opportunities.
The discount rate in respect of the interim dividend for FY24 has been set at 1.0%.
The last day for shareholders to notify their participation in the DRP is 18 December 2023.
The pricing period is from 8 January 2024 to 19 January 2024.
Metcash will announce the DRP price and shares to be issued 22 January 2024, with shares issued on 30 January 2024.
Existing shareholders resident in Australia and New Zealand will be sent an invitation to participate in the DRP. Full DRP details are provided on Metcash’s website at: www.metcash.com/investor-centre/DRP. 5

Outlook Group Sales growth has continued in the first four weeks of 2H24.
The Food and Liquor pillars are performing well, supported by their competitiveness and differentiated value proposition.
Hardware continues to perform better than the market and remains ideally positioned in the detached home and professional tools segments to capitalise on an improvement in consumer confidence and activity levels.
The Company continues to have a strong focus on costs and working capital management, and expects to deliver between $14m to $16m of annualised savings from its cost optimisation program in the second half.
Metcash remains well positioned for future growth and strong returns through the cycle.
This is underpinned by a balanced portfolio of businesses that have solid fundamentals, healthy and supportive retail networks, leading market positions, a strong financial position and a significant pipeline of strategic growth opportunities.
Sales update – first four weeks of 2H24 Total Group sales increased 0.8% with growth in Food ex-tobacco, Hardware and Liquor compared to the prior comparative period.
Total Food sales ex-tobacco increased 4.8% (approx. flat including tobacco), with Supermarkets wholesale sales ex-tobacco up 4.9% (approx. flat including tobacco) with the return to volume growth seen in the second quarter continuing.
Wholesale price inflation for November (ex-tobacco and produce) was 4.4%.
Total Hardware sales increased 2.4% reflecting a return to growth in IHG, with sales up 1.6% and a 6.2% increase in Total Tools buoyed by store footprint expansion and acquisitions.
Liquor sales were 1.5% higher with growth in sales to retail and on-premise customers.

( i have held MTS in the past where i probably realized my losses too early )

hmmm !

to my eyes not so impressive ( but possibly more honest than some rivals )

will the market reveal a good reason to re-enter MTS ( CHEAP )
 
Bought into MTS this morning.
Like others, I spend a fortune at Total Tools, shop at IGA, in preference to Coles/Woolies, and our local hardware is a Mitre 10 which I frequent regularly in preference to travelling to Bunnings..
Price been knocked down a bit, looking for some defensive stocks for the next medium term investment period.
Mick
 
mullokintyre said:
Bought into MTS this morning.
Like others, I spend a fortune at Total Tools, shop at IGA, in preference to Coles/Woolies, and our local hardware is a Mitre 10 which I frequent regularly in preference to travelling to Bunnings..
Price been knocked down a bit, looking for some defensive stocks for the next medium term investment period.
Mick
Click to expand...
made a ( probable ) dumping them a few years back

am still dithering about 'second time lucky '

the two local IGAs i visit ( two different cities ) are better to shop at than the bigger rivals ( i hold both WOW and COL )

i still prefer the small independent hardwares ( unless shopping disposable tools for casual workers , 'cos they lose them , break them , leave them rust in the rain ) ( i hold WES and BWP )

but maybe a little lower with lure me into a dabble ( i see defensive' as similar to SUL where retail across several brand names seems to be the key ) also think of MTS as a distribution network ( the thing WOW can't get together effectively )
 
mullokintyre said:
Bought into MTS this morning.
Like others, I spend a fortune at Total Tools, shop at IGA, in preference to Coles/Woolies, and our local hardware is a Mitre 10 which I frequent regularly in preference to travelling to Bunnings..
Price been knocked down a bit, looking for some defensive stocks for the next medium term investment period.
Mick
Click to expand...
Should have added that well credentialled Richard Murray, ex Premier Investments and ex JB Hi-FI exec , being tapped to run Total Tools was another point that tipped me over the line.
Mick
 

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