Insights

Coles (ASX:COL) share price slips as the company prepares for a new era

Is Coles now better than before the pandemic?
The post Coles (ASX:COL) share price slips as the company prepares for a new era appeared first on The Motley Fool Australia. –

The Coles Group Ltd (ASX: COL) share price is slipping to the downside on Wednesday. This comes after the supermarket giant held its annual general meeting (AGM) this morning.

Both the company’s CEO and chair discussed how the second-largest retailer on the ASX navigated the perils of COVID-19 over the past year. From these lessons, management painted a picture of the vision for Coles in the year ahead.

At the time of writing, the Coles Group share price is trading at $17.61, down 0.4%. For context, the S&P/ASX 200 Index (ASX: XJO) is off by 0.3% near the end of trading.

Let’s take a look at what management shared with investors today.

Exiting the pandemic ‘a better business’

While some analysts have been bearish on the Coles share price in recent times, the management at the company’s AGM held a more positive sentiment.

Addressing a mix of in-person and online attendees, Coles chair James Graham highlighted the amplified interruptions of COVID-19 during the year, saying the company had experienced 11 different lockdowns during the last financial year. In addition, a further 6 lockdowns have occurred in the first four months of this financial year.

To grasp the extent of disruptions to Coles directly, Graham said as many as 3,000 team members were in isolation at any one time. Despite this, the company managed to increase sales revenue by 3% during FY21, while net profits rose 7.5%. Further, during this period an additional 64 new stores were opened.

CEO and managing director Steven Cain added that in the process of navigating the erratic nature of pandemic, Coles has grown. He told the AGM, “In many ways, your company is exiting the pandemic a better business.”

Unfortunately, these positive statements have not managed to lead to a higher Coles share price today.

The AGM also heard Coles has adopted more technological approaches to business. One example of this was being the first mainstream Australian supermarket to abandon the delivery of door-to-door paper catalogues. While adopting a more digital approach, the catalogue removal also bolstered the company’s sustainability credentials.

Additionally, the ‘Smarter Selling’ program — which involves reducing $1 billion worth of costs by increased business efficiency — has now reached total cumulative savings of more than $550 million. Of this, approximately $300 million were realised in FY21 alone.

What’s ahead?

Speaking on the outlook for Coles, Cain said:

Looking ahead, as vaccination rates continue to rise across the country, we are optimistic on the outlook for the Christmas period as Australians adjust to life after lockdown and are once again able to enjoy time with family and friends.

Another win for customers, the company will include Bunnings and Officeworks as Flybuys partners from early December.

Coles share price snapshot

Despite the exuberance shared by management in the AGM today, the Coles share price has substantially underperformed the broader market over the past year. While the Aussie index has served up a 17% return in the prior 12 months, Coles has fallen 0.3%.

On a positive note, at these price levels, the blue chip investment is offering up a 3.45% dividend yield.

The post Coles (ASX:COL) share price slips as the company prepares for a new era appeared first on The Motley Fool Australia.

Should you invest $1,000 in Coles Group right now?

Before you consider Coles Group, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Coles Group wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

5 things to watch on the ASX 200 on Wednesday

Can Woolworths (ASX:WOW) win its delivery battle against Coles?

Is the Coles (ASX:COL) share price a buy for the 5% dividend yield?

Top brokers name 3 ASX shares to sell next week

Christmas is coming, but is the Coles (ASX:COL) share price already overstuffed?

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!