Coles eyes $1b in cost cuts by 2023

Company News

by Anna Napoli

Coles (ASX:COL) is set to cut costs, optimise its store network and increase sustainability in a structural overhaul following its $20 billion demerger from Wesfarmers last year.

At its Investor Day in Melbourne today Coles flagged cumulative cost savings of around $1 billion by FY23.

Coles CEO Steven Cain says the strategy directly aligns with the creation of long-term shareholder value by growing revenue at least in line with the market, reducing costs, and generating sufficient cash to fund growth and innovation while delivering an attractive dividend payout ratio.

Coles' net capex outlook for FY19 remains unchanged at $700m-$800 million while comparable Supermarket sales growth for fourth quarter expected to be in the upper half of the range between second and third quarter comparable growth adjusted for New Year’s Eve.

Shares in Coles (ASX:COL) Closed 1.85 per cent lower at $12.77 yesterday.