The Coles Group Ltd (ASX: COL) share price is up more than 2% after the company reported its FY26 result.
Coles is the second largest supermarket business in Australia. It also has a liquor division which includes Liquorland.
FY26 result
Here are the highlights of the report for the 12 months to 28 June 2026:
- Revenue grew 2.8% to $45.6 billion
- Underlying EBITDA (EBITDA explained) grew 7.1% to $4.2 billion
- Underlying EBIT rose 9.9% to $2.3 billion
- Underlying net profit increased 13.7% to $1.25 billion
- Statutory net profit increased 1% to $1.09 billion
- Final dividend per share of $0.37, up 15.6%
- Annual dividend per share of $$0.78, up 13%
What happened in this report?
Coles’ supermarket revenue rose 3.7% to $41.5 billion, but the liquor division saw revenue fall 3.3% to $3.5 billion and other revenue declined 19.6% to $561 million.
On an EBIT basis – which I think is a better reflection of operating profitability than EBITDA – supermarket EBIT rose 12.2% to $2.37 billion, liquor EBIT dropped 47.8% to $59 million and other EBIT improved 6.4% to $102 million.
The company’s statutory figure was impacted by $235 million (or $165 million after tax) as a result of the Federal Court judgement received in September 2025 regarding the Fair Work Ombudsman’s proceedings about Coles wages.
In the supermarket division, excluding tobacco, the company experienced sales growth of 5.1% in FY26. Supermarket e-commerce sales increased 5.6%, while the e-commerce penetration has now reached 13.6% of supermarket sales. Exclusive to Coles sales increased by 6.1%.
Coles noted that supermarket inflation excluding tobacco was 1.2%. When excluding tobacco and fresh, supermarket inflation was 0.8%.
Interestingly, the supermarket gross profit margin improved by 37 basis points (0.37%) to 27.8% during the period. Coles attributed this improvement to a shift in lower tobacco sales and annualised benefits of the new automated distribution centres (ADC).
Coles also said that the supermarket cost of doing business (CODB) as a percentage of sales improved by 6 basis points (0.06%), including a 23 basis point (0.23%) improvement in the second half.
The company said that disciplined cost management, operating leverage and strong execution of its initiatives helped offset higher costs.
Coles noted it completed the external construction of its new ambient automated distribution centre (ADC) in Victoria, which will serve both Victoria and Tasmania. Witron is now installing the automation fit-out on the site. This $880 million development remains “on time and on budget” with completion expected by FY30.
Outlook for the Coles share price
Coles said that it’s entering FY27 in a strong position, with its supermarket business gaining its market share and improving customer satisfaction scores over the past year.
Sales growth for the first eight weeks of FY27 was consistent with the fourth quarter of FY26.
In liquor, the sales trajectory strengthened across the first eight weeks relative to the fourth quarter of FY26. Its convenience portfolio continued to deliver positive growth, while performance in the warehouse portfolio also improved.
The company continues to deliver sales growth and underlying earnings growth, while funding larger dividends.
