Fuel prices weigh on Coles Express sales

By C&I Week

Wesfarmers has announced its third quarter retail sales results, with total Coles Express sales, including fuel, $1.4 billion, a decrease of 8.9 per cent on the prior corresponding period as lower fuel prices and volumes offset continued growth in convenience store sales.

Total Coles Express sales for the financial year to date decreased 8.5 per cent to $5.1 billion. For the quarter, headline fuel volumes decreased 6.3 per cent and comparable fuel volumes decreased 10.1 per cent. For the financial year to date, headline fuel volumes decreased 2.4 per cent and comparable fuel volumes decreased 5.8 per cent.

As evident in the first half, weighing on fuel volumes were headwinds from competitor site openings and disruption to the network, caused by regulatory and environmental compliance works. In addition, during the quarter, there was an increased focus by competitors on their fuel offer in order to drive footfall into stores.

Convenience store sales increased 12.9 per cent for the quarter and 8.1 per cent on a comparable store basis. For the financial year to date, convenience store sales were up 12.0 per cent and up 8.0 per cent on a comparable store basis.

Coles Express continued to expand its network during the quarter, opening six new sites to bring the total store network to 687 sites.

Food and liquor

Headline food and liquor sales for the quarter were $7.5 billion, up 5.9 per cent on the previous corresponding period. Food and liquor sales for the financial year to date increased 5.6 per cent to $24.2 billion.

Comparable food and liquor store sales increased 4.9 per cent and comparable food store sales increased 4.9 per cent for the quarter.

For the financial year to date, comparable food and liquor store sales increased 4.5 per cent and comparable food store sales increased 4.8 per cent.

Adjusting for the earlier timing of Easter in the 2016 financial year compared to last year, comparable food and liquor store sales and comparable food store sales for the quarter increased 4.4 per cent and 4.5 per cent respectively.

Food and liquor price deflation was 2 per cent during the quarter, bringing food and liquor price deflation to 1.4 per cent for the financial year to date.

Every category recorded deflation throughout the quarter, with the exception of meat and tobacco where inflationary pressures continued.