The Coles Group Ltd (ASX: COL) share price only declined by 1.2% over the month, compared to a fall of 3% for the S&P/ASX 200 Index (ASX: XJO). Therefore, Coles shares outperformed by around 2%.
For starters, the ASX supermarket share announced its FY23 third-quarter numbers on the last trading day of April, so some investors may have reacted to that performance during May.
Coles said that its total continuing sales increased by 6.6% to $9.4 billion, with 7% growth for supermarket sales to $8.6 billion and 2.6% growth for liquor businesses to $800 million.
Considering supermarket retailing is a defensive industry, it's perhaps not too surprising that Coles fell less than the market last month.
But, there were announcements that the ASX 200 share made during the month as well that could have impacted the Coles share price.
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Completion of Coles Express sale
Coles announced that it had completed the sale of its Coles Express fuel and convenience business to Viva Energy Group Ltd (ASX: VEA).
The supermarket business said that it had received $300 million cash from Viva Energy, and has assigned leases, which represented a liability of $816 million on Coles' balance sheet as at 30 June 2022.
As part of the deal, the two businesses have entered into a multi-year strategic partnership. Coles customers will get access to the four-cent per litre fuel docket across the network and Viva will remain a partner of the Flybuys program.
Coles will also continue to partner with Viva Energy regarding product supply arrangements, including the Coles own-brand product range.
The Coles Express-branded network will be rebranded by Viva Energy, the majority of which will be completed over the next two years.
Automated distribution centre presentation
The company also held a site tour of its automated distribution centre located in Queensland during the month.
Coles reminded investors that it is investing around $1 billion in its supply chain automation program, with around 70% invested by the end of the FY23 first half.
It's building two new automated distribution centres, replacing five 'manual' distribution centres across NSW and Queensland.
Coles said these facilities will enable better availability for customers, and deliver structural cost efficiencies. They will provide "double the capacity at two-thirds [the] operating cost". This could be a boost for the Coles share price once they're fully operational.
The first automated distribution centre started outbound deliveries in March 2023, with the first scheduled for the first inbound delivery in the third quarter of FY24.
Coles has an exclusive partnership with Witron, which it described as a global leader in supply chain technology.
Foolish takeaway
Since the start of the year, the Coles share price has gone up 8% while the ASX 200 has gone up by less than 3%, as we can see on the chart below. It has been a good year for the company so far.
