Metcash (ASX:MTS): What Do FY26 Earnings and Its Hardware Expansion Reveal?

Aditi Sarkar

26 October 2026 11:31 PM AEDT

Metcash (ASX:MTS): What Do FY26 Earnings and Its Hardware Expansion Reveal?

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Highlights

Metcash (ASX:MTS) reported FY26 group revenue of AUD 19.63bn including charge-through sales, up 0.7% YoY.
Underlying EBIT was AUD 503.7mn, down 0.8% YoY, while operating cash flow reached AUD 558mn.
Food EBIT increased 5.4% YoY to AUD 261.8mn; Liquor and Hardware EBIT declined.
An October 2026 announcement confirmed Metcash had exercised its right to acquire Peries Group.

Metcash Limited is an Australian wholesaler and retail-services group supplying independent businesses across food, liquor, hardware and tools. Its FY26 results showed increased overall revenue and operating cash generation, alongside mixed earnings among the three principal divisions. In October 2026, Metcash (ASX:MTS) also disclosed that it had exercised its right to acquire Peries Group, adding another development to its hardware strategy.

Company Business

Metcash (ASX:MTS) supports independent retail networks through procurement, wholesale distribution, merchandising and operating services. Its Food division supplies independent supermarkets and convenience customers, including stores operating under the IGA banner. The Liquor division supports independent bottle shops, while Hardware & Tools supplies and services hardware merchants and trade-focused retailers.

The group also operates complementary retail, foodservice and convenience activities. Metcash’s operating model links suppliers with independent business owners, making distribution scale, store competitiveness and service standards relevant to results. The FY26 annual report describes wholesale as the core earnings contributor, while the group continues to expand retail and foodservice activities.

Recent Development

On 19 October 2026, Metcash (ASX:MTS) announced that it had exercised its right to acquire Peries Group. The development relates to the company’s hardware activities, where ownership arrangements and integration work form part of its broader operating strategy. Further announcements will determine the confirmed timetable and additional financial consequences of the transaction.

At its September 2026 annual general meeting, Metcash provided a trading update following the FY26 reporting period. The company’s 2026 annual report, issued in August, also outlined its approach to developing complementary earnings sources alongside wholesale distribution. These activities include retail, foodservice, digital capability and media services.

The latest results were released in June 2026 for the year ended 30 April. Food contributed earnings growth, while lower EBIT in Liquor and Hardware & Tools partly offset the improvement. Metcash also reported operating cash generation and investment discipline as important features of the year.

Financial Performance and Sector Context

Metcash (ASX:MTS) reported FY26 group revenue of AUD 19.63bn including charge-through sales, an increase of 0.7% YoY. Statutory sales revenue, which excludes charge-through sales, rose 0.2% YoY to AUD 17.35bn. EBITDA increased 1.9% YoY to AUD 761.7mn, while underlying EBIT decreased 0.8% YoY to AUD 503.7mn.

Underlying profit after tax declined 2.4% YoY to AUD 268.8mn, compared with AUD 275.5mn in FY25. Reported profit after tax was AUD 279.1mn, down 1.5% YoY. Operating cash flow increased 3.5% YoY to AUD 558mn. The company reported a debt leverage ratio of 1.0 times, at the lower end of its stated target range.

By division, Food EBIT increased to AUD 261.8mn from AUD 248.4mn, a 5.4% YoY increase. Liquor EBIT fell to AUD 100.1mn from AUD 104.1mn, while Hardware EBIT decreased to AUD 177.3mn from AUD 189.3mn. The contrasting segment figures reflect different demand, cost and operating conditions in grocery supply, liquor retailing and building-related markets.

Risks to Consider

Metcash (ASX:MTS) faces exposure to changes in consumer spending, competition among food and liquor retailers, and trading conditions in hardware. Independent stores must remain commercially viable for wholesale volumes to be maintained. Supplier cost changes, logistics expenditure and regulatory requirements can also affect margins. Acquisitions introduce execution, valuation and integration risks, while interest costs and working-capital needs remain relevant to cash generation.

What to Watch Next

The principal monitoring points for Metcash (ASX:MTS) include implementation of the Peries Group transaction, trading performance across its three divisions and the next half-year reporting update. Changes in food sales excluding tobacco, liquor margins, hardware demand, operating cash flow and leverage will provide additional evidence of business conditions. Progress in the company’s retail and foodservice activities will also remain relevant to its earnings mix.

Key Insights

Metcash’s FY26 financial results combined revenue growth and higher operating cash flow with a modest decline in underlying EBIT and profit. Food earnings increased, whereas Liquor and Hardware recorded lower EBIT. The October Peries Group development adds a further operational milestone. Future disclosures will provide information on divisional trading, acquisition execution and the group’s financial position.

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