Metcash profit falls 6.1pc as investment in food prices bite

 In Australia, Metcash/IGA, NewZealand
Metcash shares jumped 11 per cent to an eight-month high as the food, liquor and hardware distributor reported encouraging sales in IGA supermarkets after investing more than $100 million over the last two years to reduce grocery prices.
Metcash’s underlying net profit slumped 6.1 per cent to $86.9 million in the October-half as investments into reducing grocery prices and refurbishing stores crunched margins in the food and grocery business, wiping out gains in liquor and hardware distribution.
However, food and grocery sales stabilised, rising 0.7 per cent to $4.54 billion, and same-store sales in IGA supermarkets rose 0.6 per cent as customers responded positively to Metcash’s investment in prices, store refurbishments, a wider range of fresh foods and an improved range of private label goods. Sydney Morning Herald – Read more…

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