Metcash Limited (ASX:MTS) released its 2026 Annual General Meeting Chair's address, CEO presentation and trading update to the ASX on 9 September 2026. The documents recapped FY26 results, covering Group Revenue of $19.6 billion and underlying Earnings Per Share of 24.5 cents, and included sales trends for the first 18 weeks of FY27.

WHAT METCASH DOES

Metcash describes its purpose as Winning with Independents. It is a wholesale distribution and Marketing Business supplying independent retailers across three pillars: Food, Liquor, and Hardware and Tools. Food brands include IGA, Friendly Grocer, Campbells and Superior Food Services.

The CEO presentation lists approximately 105,000 customers, about 4,800 contract customers or stores, about 6,300 bannered retail stores, about 5,500 suppliers and 62 distribution centres, serving approximately 95% of Australians. The Group Chief Executive Officer is Doug Jones and the Chairman is Peter Birtles.

FY26 RESULTS RECAP

Group revenue, including charge-through sales, was $19.6 billion, up 0.7%, or up 3.8% excluding tobacco. Group EBITDA was $761.7 million, up 1.9%, and Group EBIT was $503.7 million, which was down 0.8% on a reported basis and up 1.6% excluding $12.4 million of strategy and integration costs. Reported profit after tax was $279.1 million and Underlying Profit after tax was $268.8 million. Underlying earnings per share were 24.5 cents, with reported earnings per share of 25.4 cents. Operating Cash Flow was $558.0 million, and the Debt Leverage Ratio was 1.0 times against a target of 1.0 to 1.75 times. Total dividends were 18.0 cents per share, fully franked, approximately 74% of underlying profit after tax.

By pillar, Food EBIT was $261.8 million, up 5.4%, Liquor EBIT was $100.1 million, down 3.8%, and Hardware and Tools EBIT was $177.3 million, down 6.3%. Sales revenue was $10.5 billion for Food, $5.4 billion for Liquor and $3.7 billion for Hardware and Tools, including charge-through sales. The Chair said the tobacco mitigation strategy offset at least $65 million of earnings from the loss of around $1.8 billion of tobacco sales since FY21, as well as lower earnings from the Hardware and Tools downturn.

Short-term incentive outcomes ranged from 7.1% to 25.4% of the maximum opportunity, and the FY24 Long-Term Incentive award vested at 20.5%. The AGM agenda includes the election of Ms Sparshott, adoption of the Remuneration Report, a grant of performance rights to Mr Jones and a special resolution on financial assistance.

FY27 TRADING UPDATE

For the first 18 weeks of FY27, Group total sales excluding tobacco were up 2.8%, or up 3.5% including tobacco. In Food, total sales excluding tobacco were up 2.6%, supermarket sales were up 2.6% excluding tobacco and up 1.3% including tobacco, and Foodservice and Convenience sales were up 2.8% excluding tobacco and up 11.3% including tobacco. Total tobacco sales were up 11.7%. In Liquor, total sales were up 0.8%, with wholesale sales to on-premise customers up 5.1% and Australian wholesale sales to IBA retail and contract customers flat. In Total Tools and Hardware, total sales were up 6.0%, with Total Tools up 9.8% and Hardware up 5.0%.

Metcash said first half earnings are expected to be affected by an adverse sales mix in Superior, the removal of the accelerated tobacco excise increase, net approximately $10 million in FY27 and weighted to the first half, and persistent cost Inflation in Food and Liquor. It said cost-out programs remain on track. The New Zealand wholesale liquor business is expected to be wound down over coming months, with an earnings impact of about $2 million excluding redundancies, while New Zealand retail liquor operations will continue.

On technology, the company said its Horizon ERP program is near completion. Release 1 is planned for the fourth quarter of calendar 2026, and Release 2 is targeted for the first quarter of calendar 2027.

RISKS AND WHAT TO WATCH

The Chair said trading conditions are expected to remain challenging. The trading update refers to elevated cost inflation, a highly competitive trading environment in supermarkets, subdued consumer Demand and elevated competitive intensity in liquor retail, and market uncertainty affecting the Hardware and Tools sector outlook. Hardware and Tools EBIT declined 6.3% in FY26, and the pillar continues to work on returning the business to mid-cycle margins. Liquor and Hardware and Tools EBIT were both lower in FY26 than in FY25.

Tobacco remains a variable, with the CEO presentation noting that tobacco sales improved in states where regulatory measures have been implemented and enforced.

NEXT MILESTONES

Milestones include the AGM votes on the resolutions on the agenda, Horizon ERP Release 1 in the fourth quarter of calendar 2026 and Release 2 in the first quarter of calendar 2027, the wind-down of the New Zealand wholesale liquor business, delivery of cost-out programs, and the first half FY27 result.