Coles Australia Reports Rising Quarterly Sales and Costs

On Wednesday, Coles Group reported slightly higher first-quarter sales due to higher product prices and COVID-19 restrictions. However, the Australian retail company predicted hefty input expenses.

Retailers worldwide have raised prices due to rising gas and ingredient costs. To counteract rising inflation, the Australian central bank raised interest rates six times this year.

Floods will increase supply quantities and Coles' December quarter expenses.

The supermarket segment, which accounts for most of the group's earnings, rose 1.6% to A$8.77 billion ($5.60 billion), although UBS expected A$8.93 billion.

Coles revealed a 7.1% first-quarter supermarket inflation rate, up from 4.3% in the previous quarter. Reopening restaurants also increased sales.

The retailer's quarterly volume was lower since lockdowns last year caused hoarding of essential items, which raised volumes.

The Melbourne-based company, which has over 800 outlets in Australia, lowers prices on some grocery products to boost sales.

Coles fell 2.5% to A$16.18 in early trading, while the Australian market rose 0.4%.

Coles reported A$9.89 billion in group sales for the 13 weeks ending September 25, up from A$9.77 billion a year earlier.

Woolworths may report first-quarter sales on November 3.