Metcash Ltd (ASX: MTS) shares are in the spotlight on Monday.
In morning trade, the wholesale distributor's shares are down slightly to $3.16.
This follows the release of the ASX 200 stock's FY 2026 results.
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ASX 200 stock lower on results
For the 12 months ended 30 April, Metcash reported a modest 0.2% increase in revenue (excluding charge-through sales) to $17.35 billion. Including charge-throughs, revenue increased 0.7% to $19.63 billion.
Management notes that this reflects a small decline in Food revenue, which was offset by growth in Liquor and Hardware revenue.
The ASX 200 stock's underlying EBIT was down 0.8% to $503.7 million due to weakness in the Hardware and Liquor segments.
The Food segment delivered a strong performance in FY 2026, with EBIT increasing 5.4% to $261.8 million. It highlights that the IGA network remains a core strength, with the large store price gap narrowing to 2.1%, making the network more price competitive than ever. Foodservice & Convenience continued its rapid expansion, supported by the integration of Superior Foods and strong demand from corporate customers.
The Liquor segment posted a resilient result, with revenue increasing 1% to $5.4 billion and market share rising to 32.3%. It notes that segment EBIT was $100.1 million, slightly lower than the prior year due to softer first half trading, but the business delivered a stronger second half as shopper demand for convenience and localised offers remained robust and inflation increased.
Although Hardware & Tools delivered revenue growth of 4.3% to $3.7 billion, EBIT was down 6.3% to $177.3 million. This reflects softer trade conditions for its Hardware retail stores in Victoria and Tasmania, partially offset by continued strength in Total Tools.
On the bottom line, Metcash recorded a 2.4% decline in underlying net profit after tax to $268.8 million. This was largely in line with consensus estimates.
The ASX 200 stock's Board declared a fully franked final FY 2026 dividend of 9.5 cents per share, which is flat on the prior corresponding period. This brings total dividends for the year to 18 cents per share fully franked, which is in line with FY 2025's dividends.
Management commentary
Commenting on the results, Metcash's CEO, Doug Jones, said:
Our FY26 performance demonstrates the strength and resilience of the Metcash business model. Despite mixed trading conditions across our markets, we delivered solid earnings, strong cash generation and continued progress on our long-term strategic priorities. Our scale, our national supply chain, and our deep relationships with independent retailers remain powerful competitive advantages. We now support ~105,000 customers, ~6,300 bannered stores and reach ~95% of Australians – a unique platform that continues to generate resilient, high-quality cashflows.
We are winning with independents because we combine the benefits of scale with the agility and community connection of local ownership. This combination is difficult to replicate and continues to underpin our performance across all pillars.
Outlook
The ASX 200 stock revealed that sales have made a steady start to FY 2027 and are up 1.7% during the first seven weeks. This reflects softer trading conditions in May followed by a clear improvement in June.
Management appears confident it can build on this. It stated:
Metcash enters FY27 with strong momentum across its core businesses. Foodservice & Convenience continues to scale rapidly, Liquor remains resilient with growing market share, and Hardware & Tools is positioned for margin recovery through its strategy reset and as market conditions improve. The Group expects to continue strengthening its competitive advantages, expand its digital and AI-enabled capabilities, and support independent retailers to win in their local communities.
