The Metcash Ltd (ASX: MTS) share price is in focus after the business announced its FY26 result.
Metcash is a business that supplies IGA supermarkets around Australia, it also has a division that supplies commercial customers (and other organisations) such as hotels, restaurants and cafes. The business also has a hardware division (Home Hardware, Total Tools, Mitre 10) and a liquor division that supplies hundreds of independent liquor stores.
FY26 result
Metcash reported its numbers for the 12 months to 30 April 2026:
- Group revenue rose 0.7% to $19.6 billion (or 3.8% excluding tobacco)
- Group EBITDA (EBITDA explained) increased 1.9% to $761.7 million
- Underlying EBIT fell 0.8% to $503.7 million
- Underlying net profit down 2.4% to $268.8 million
- Statutory net profit down 1.5% to $279.1 million
- Annual dividend per share of $0.18, same as last year
- Interim dividend per share of $0.095, same as last year
The company noted that its underlying EBIT increased 1.6% if ‘one-off’ integration and strategy costs were excluded.
How did each division perform?
Food is the biggest generator of revenue for the business, FY26 food revenue grew by 5.4% excluding tobacco. EBIT also increased by 5.4% to $261.8 million.
Metcash said the food segment continued to improve its competitiveness and value proposition, with the IGA large-store price gap narrowing to 2.1%. Metcash said that it progressed its retail ownership strategy, completing its first supermarket acquisitions in the fourth quarter of FY26 – more on that below. The foodservice and convenience division continued its “rapid expansion”.
In the liquor division, revenue increased 1% to $5.4 billion, with market share rising to 32.3%, according to Metcash. Liquor EBIT of $100.1 million was slightly lower year over year because of a softer first half.
In hardware, revenue grew 4.3% to $3.7 billion, with second half momentum across hardware and tools. EBIT was $177.3 million, or after excluding one-off integration and strategy costs it was $184.2 million, reflecting softer trading conditions for retail stores in Victoria and Tasmania, partially offset by strength for Total Tools, growing earnings by 3.7%.
The integration of Total Tools and its other hardware businesses has been completed, with duplication removed and scale benefits beginning to flow.
Supermarket ownership
Metcash said disciplined acquisitions of high-quality IGAs will allow accelerated network growth by enabling faster rollout of greenfield and brownfield acquisitions.
By doing this, it can bring innovation faster, including loyalty, retail media, e-commerce and new programs.
Metcash said this would protect the IGA network and provide a responsible exit pathway for retailers without succession.
These stores will continue to trade under existing branding. The business unit within Metcash will be “Action Supermarkets”.
In the long-term, it’s targeting to own between 25% to 30% of IGA network revenue.
Outlook for the Metcash share price
The company gave a trading update for the first seven weeks of FY27.
Metcash reported that food and liquor experienced a subdued May due to the geopolitical uncertainty and cost-of-living pressures, though both pillars recovered well in the first three weeks of June, trading in line with FY26 growth levels.
For those first seven weeks of FY27, total food sales were up 0.7% (or 1.6% excluding tobacco sales), while liquor total sales were up 1.3%.
The hardware and tools segment continues to deliver “strong momentum”, led by high single digit growth in Total Tools. Overall revenue for this segment rose 5.8%.
It’s not as cheap as it was last month, but the Metcash share price could still be undervalued if hardware earnings can continue rising over time.
It could be one of the ones to watch for investors wanting ASX dividend shares.
