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Business · Asia Pacific

Coles shares drop 10% after profit outlook

Coles forecast flat first-half supermarket profits and its shares fell 10% in early trading after the company released quarterly results. The shares later recovered some losses, standing 6.8% lower shortly after midday.

AI-assisted synthesis · Based on 2 independent reports from 3 outlets · Article text read from 1 of 2 reportsHow it's made

View timeline · 7 entries
3 outletsLatest reporting 3 min read
Coverage: Too few ratedL 0 · C 2 · R 0 · 1 unrated
Updat3 graphic: Coles
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What happened

Key facts

  • Coles shares fell 10% in early trading after the company released quarterly results, removing about $3.5 billion from its market value (per The Sydney Morning Herald).
  • Coles shares were down 6.8% shortly after midday after recovering some earlier losses (per The Sydney Morning Herald).
  • Coles said fuel costs and supplier requests for price increases would add to expenses, along with higher wages, utilities, rent and insurance costs (per The Sydney Morning Herald).
  • The Age headline said Coles had lost ground to Woolworths (per The Age, The Sydney Morning Herald).

The brief

Coles forecast flat first-half supermarket profits, and its shares fell 10% in early trading after the company released quarterly results. The Sydney Morning Herald reported that the decline cut about $3.5 billion from Coles’ market value. The shares later recovered some of their losses and were down 6.8% shortly after midday.

The forecast came as Coles described slower supermarket sales growth. The company attributed the slowdown to customers looking for bargains and stronger competition in the supermarket sector.

The Age headline also said Coles had lost ground to Woolworths, while Market Index characterized the outlook as flat first-half 2027 supermarket earnings and said it missed forecasts by 7%. Coles said it expected first-half supermarket profits to be flat compared with the prior period.

The Sydney Morning Herald reported that Citi analyst Adrian Lemme contrasted this guidance with Citi’s earlier forecast for 8% growth and said the figures indicated weaker momentum relative to Woolworths. That comparison was Lemme’s assessment; the company’s own guidance was the flat-profit forecast.

Chief executive Leah Weckert said customers were looking for specials and using loyalty points as household budgets came under pressure. She said supermarket prices excluding tobacco remained stable at 1.1% in the three months to September, with higher dairy and meat costs contributing to that rate. Coles also pointed to costs it expects to face.

The company said fuel expenses and supplier requests for price increases would add to costs, alongside higher wages, utilities, rent and insurance. These pressures were cited as the company reported slower sales growth and gave its profit outlook.

Weckert described demand for some grocery products as strong, including canned sardines and products that help customers shorten meal preparation. Her comments were part of the company’s account of changing customer purchasing patterns, alongside its observation that shoppers were seeking specials and using loyalty points.

The trading figures shifted during the day: shares were down 10% in early trading, then down 6.8% shortly after midday as they regained some ground. Coles’ stated outlook remained flat first-half supermarket profits, while the company identified customer price-consciousness, competition and a range of rising costs as relevant pressures.

Why it matters

  • Coles shareholders faced a sharp market-value change: shares fell 10% in early trading, removing about $3.5 billion from the company’s market value, before recovering part of the decline.
  • Coles customers’ price-conscious shopping is reflected in the company’s account that they sought specials and used loyalty points while household budgets were under pressure.
  • Coles identified specific cost pressures—fuel, supplier price requests, wages, utilities, rent and insurance—alongside its flat first-half supermarket profit outlook.

What to watch next

  • Whether Coles updates its forecast of flat first-half supermarket profits.
  • Whether Coles reports further changes in supermarket sales growth amid the competition and bargain-seeking customer behavior it cited.
  • Whether Coles reports additional costs from fuel, supplier price requests, wages, utilities, rent or insurance.

How it's being covered

Coverage analysisShow details
3 source articles · 3 unique outlets · 2 distinct reports
Outlet political mix: Too few rated· 2 Center · 1 unrated
Where the outlets are based: Asia 100%
Outlet political mix
Too few rated
Left
Center
Right
0 outlets
2 outlets
0 outlets
The marker shows coverage balance: each unique outlet counts once. 1 unrated outlet is not included.
Geography
Where the outlets covering this story are based.
3 unique outletsDominant coverage: Asia
Coverage imbalance
  • Coverage is currently concentrated among outlets based in Asia (3 of 3 geographically-identified sources).
How we measure coverage

How outlets' accounts compare

Updat3 does not yet have enough full reports to compare how outlets framed this story.

Timeline

Developments from this story's sources, dated background we compiled and fact-checked, and our earlier coverage. Each row says which.
  1. Coles began in 1914, when George Coles opened a variety store in Collingwood, Melbourne.
    Background · from our historical context
  2. Woolworths opened its first store in Sydney in 1924, establishing the long-standing domestic rivalry between Australia’s two largest supermarket chains.
    Background · from our historical context
  3. The ACCC conducted an inquiry into grocery competition and pricing.
    Background · compiled and fact-checked by Updat3
  4. The regulatory framework includes Australia’s Food and Grocery Code of Conduct, established in 2015 as a voluntary code governing dealings between large retailers and suppliers.
    Background · from our historical context
  5. Coles became a separately listed company in 2018 after Wesfarmers completed its demerger.
    Background · from our historical context
  6. On 25 January 2024, the Australian Competition and Consumer Commission (ACCC) began a public inquiry into the supermarket sector, examining competition, prices and suppliers’ dealings with the major chains.
    Background · from our historical context
  7. In March 2024, the federal government announced plans to make the code mandatory and introduce penalties for breaches.
    Background · from our historical context

How we got here

Coles’ latest comparable annual results before the current trading event were released on 27 August 2024, when the company reported its 2023–24 financial-year performance amid scrutiny of supermarket prices and competition.

On 25 January 2024, the Australian Competition and Consumer Commission (ACCC) began a public inquiry into the supermarket sector, examining competition, prices and suppliers’ dealings with the major chains.

Original sources

3 articles from 3 outlets · Asia · Show all

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