Endeavour shares slide despite growth in sales
Make us a preferred source
Make us a preferred source on Google
More news: Shares in Endeavour Group dipped 4% to $5.05 at 12:30pm AEDT, despite reporting year-on-year rises in group sales and EBIT for the half to December 2023.
What they said: Jarden analysts said Endeavour's results were solid, noting Endeavour's strong cash flow and solid margins.
"Focus, however, will be on the trading update and how margins can be managed against benign revenue growth and views on relative performance in the market," they said.
"Overall, [Endeavour] may see slight negative revisions to consensus based on the trading update with 1H a touch ahead and higher net interest costs."
BWS and Dan Murphy's sales boost Endeavour Group earnings
The news: Endeavour Group reported a 2.5% rise in group sales for the half to December, boosted by strong performance in its retail liquor chains BWS and Dan Murphy's.
The numbers: Endeavour's sales grew from to $6.7 billion compared to $6.5 billion during the prior corresponding period. Group EBIT increased 2.6% to $661 million while net profit dipped 3.6% to $351 million.
Earnings for its retail division rose 4.3% to $436 million and hotel earnings increased 1.6% to $260 million.
The group declared an interim dividend of 14.3 cents per share, in line with the year prior.
The context: Endeavour CEO Steve Donohue said Dan Murphy’s and BWS drove increased sales for its retail arm, and an "improved food and bar offering" delivered growth in hotels sales.
The pubs, liquor stores and hotels operator, which demerged from Woolworths in 2021, said group earnings benefitted from a disciplined focus on cost optimisation, including $53 million in savings from its endeavourGo program, and gross margin management.
On its full-year outlook, Endeavour said its retail trading activity was broadly flat during the first seven weeks of the second half, reflecting subdued sales in January.
The source: ASX announcement
