Endeavour Group expects a lower half-year profit in F26
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The news: Drinks and hospitality company Endeavour Group expects to report a half-year profit before tax and significant items of between $400 million and $411 million, down from $437 million last year.
Endeavour expects to incur a pre-tax net expense of approximately $45 million, with $40 million of this relating to a provision for one-off cessation costs associated with the closure of the Melbourne Liquor Distribution Centre.
The company also expects a 0.3% increase in its half-year sales to total $5.5 billion.
The context: The trading performance update comes after the company saw a 2.2% sales increase for the second quarter for Dan Murphy and BWS, after delivering four consecutive months of sales growth. Combined sales over the first-half period were up 0.7% year on year to $5.4 billion.
The holiday period that includes Christmas and New Year’s Eve saw a record sale in December for Dan Murphy, with Christmas Eve setting a new daily sales record for the alcohol beverage company.
Endeavour’s hotel sector also saw a 4.4% increase to $1.2 billion in the first half, driven by an uplift in gaming, strong results from refurbished venues, and positive trends in food and bar transactions, as well as increased uptake in accommodation bookings for the December holiday period. The company expects pre-tax earnings to be between $271 million and $275 million.
Meanwhile, ALH Hotels managing director Paul Carew has resigned to pursue other career opportunities, with Pinnacle Drinks director Paul Walton set to assume the role on an interim basis.
What they said: "The pricing and promotional decisions we have made in our retail business have generated positive sales results, delivering on our aim to better align the customer propositions for each of our brands to re-ignite top line growth," Endeavour Group CEO Jayne Hrdlicka said.
