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Annual Report 2017
Successful
Independents
Metcash is Australia’s
leading wholesaler and
distributor, supplying and
supporting more than 10,000*
Independent Retailers across
the food, grocery, liquor and
hardware sectors.
Our focus is to support
Successful Independents to
become the ‘Best Store in
Town’, by providing our network
of strong retail brands with
merchandising, operational and
marketing support.
About us .................................. 2
Chairman’s Report ................... 4
CEO’s Report ........................... 6
Financial Highlights .............. 10
Logistics ................................ 12
Food ...................................... 14
Liquor .................................... 16
Hardware .............................. 18
CSR ....................................... 20
Our people............................. 24
Financial Report .................... 26
Corporate Information ......... 105
* Number of Independent Retail customers
1 #About us
About us
Our purpose Successful independents
Our vision
Best store in every
town
–
–
Differentiated
offer & service
Celebrating
Individuality
– Loved by locals
Business partner of
choice for suppliers
and independents
–
Australia’s
leading portfolio
of independent
retail brands
–
World class
wholesaler
Passionate
about independents
–
Unlocking the
potential of
our people
–
Inspiring future
leaders
Thriving
communities, giving
shoppers choice
–
–
Championing local
entrepreneurs
Pipeline of
aspiring new
business owners
– Sustainable
Our distribution network
Our national distribution network delivers products
to more than 10,000 retail premises and a further
~95,000 wholesale customers across the food,
grocery, liquor and hardware markets.
Our Independent Retail and wholesale customers are
supported by distribution centres in each of the major
cities, as well as a number of smaller distribution
centres in regional areas.
Our values Integrity is our foundation
Our retail footprint
–
Supporting our customers and suppliers
–
Our people are empowered and accountable
–
Adding value in our community
Supermarkets
Convenience
Hardware
Liquor
1 Includes 5,468 Cellarbrations on-premise customers
No of Retail Premises
1,683
18
740
7,9851
No of Wholesale Customers
>1,400
>90,000
>500
>3,800
Our model
Our markets
Our retail brands Independence is worth fighting for!
M e t cash
tailer
Shopper
led
S
u
p
r
e
p
l
i
R
e
2
Food
Liquor Hardware
3
#Chairman’s Report
Rob Murray
Chairman
Chairman’s Report
I am pleased to present
Metcash’s Annual Report
for 2017, a year of
achievement, change and
challenge for the company.
During the year we faced some of the most
difficult external conditions in our history,
particularly in Supermarkets where the
continuation of intense competition led to
price deflation at very high levels. Our ability
to deliver some pleasing financial outcomes
and continue to successfully execute our
strategic initiatives in these conditions is,
I believe, admirable.
Our strategy continues to focus on ensuring
that independent family-owned retail
businesses can thrive across the markets
we serve. Key to this is supporting our retail
customers to be the ‘Best Store in Town’ with a
localised, differentiated offer that is tailored to
their local community.
We made significant progress in the year with
our ‘Best Store in Town’ initiatives, including a
further 100 stores completing Supermarkets’
Diamond Store Accelerator program, and an
additional 10 stores completing the Sapphire
Store Refurbishment program in Hardware.
These have led to some truly remarkable stores
that are receiving strong customer support.
We have provided some more information on
our ‘Best Store in Town’ initiatives, together
with some case studies profiling how the stores
are benefiting from the transformations on
pages 14 to 19 of this Annual Report. I hope
you find this informative.
Earnings performance
Underlying profit after tax for the year increased
9.3% over the prior year to $194.8 million.
This excludes $22.9 million of costs related to
the acquisition and integration of the Home
Timber & Hardware Group (HTH), as well as
restructuring costs related to our Working
Smarter program aimed at simplifying the way
we do business. Underlying earnings per share
was 20.3 cents, and 17.9 cents including the
$22.9 million of costs mentioned above.
The success of our Working Smarter program
in the year reflects considerable effort and
dedication from our people. The importance of
this work in the context of the current external
environment cannot be underestimated.
Acquisition of HTH
The acquisition of HTH is very exciting for
us. Not only is it a quality national hardware
operation, it is also complementary to our
Mitre 10 business. The increased scale it
provides through the creation of Australia’s
second largest hardware player, enables the
expanded network to operate more efficiently
and competitively.
While the acquisition creates new attractive
growth opportunities we will look to pursue, our
immediate focus is to ensure the integration
of the two businesses continues to be smooth
and deliver on our expectations. We have a very
capable team that is doing a great job, and I am
confident this will be achieved.
The acquisition is also important for the
diversification it provides to our Group earnings,
which is in line with our strategic focus on
ensuring the financial position of the company
remains strong and resilient.
4
Our strategy continues to focus on ensuring that
independent family-owned retail businesses can thrive
across the markets we serve.
We also have a strong focus on organisational
culture and employee engagement which is
helping underpin our performance. We have
a well established program in this area, with
a high level of employee participation, which
importantly includes the Board and senior
leadership team. Your Board continues to be
actively involved in this area and was rated
highly by both management and external
stakeholders in the engagement survey.
Earlier this month we announced that Jeff
Adams will succeed Ian Morrice as Group Chief
Executive, following earlier advice from Ian that
he intended to retire from the role in 2018.
Ian has held this position since June 2013,
and has overseen the repositioning of the
company through a consumer focus, a strong
balance sheet and a very capable management
team to take the business forward. He also
led transformation initiatives that have seen
many of our Independent Retail customers
improve their competitive position. I would like
to sincerely thank Ian for his significant effort
and achievements.
Jeff has broad international experience in the
retail and wholesale industries and is ideally
suited to lead the company’s continued focus
on supporting the success of Independent
Retailers. We look forward to Jeff joining us in
September this year.
On behalf of the Board, I would like to thank
our people, the leadership team and all of our
partner suppliers and retailers for their ongoing
support as we work to ensure a sustainable and
healthy Independent Retailer network.
I would also like to recognise the support
and contribution of my fellow Directors.
Together, we have formed a hardworking and
cohesive team.
Rob Murray
Chairman
Balance sheet strength
The financial highlight for the year was our
strong cash performance. This, together with
equity raised to partly fund the HTH acquisition,
were the key drivers of net debt reducing a
further $194.7 million to $80.8 million.
Strengthening our financial position has been
a strategic priority for a number of years, and
it is pleasing to report that we have reduced
net debt by ~$690 million since FY14. This is a
significant achievement.
We now have a very strong financial position,
and this underpinned the Board’s decision
to bring forward the recommencement of
dividends with the declaration of a 4.5 cent per
share fully franked final dividend for FY17. The
Board has also decided to target a dividend
payout ratio of 60% commencing in FY18, with
interim and final dividends to be weighted
similarly to prior practice.
Remuneration
We have continued to refine our remuneration
framework to deliver market-aligned
remuneration practices, including taking into
consideration concerns raised at last year’s
Annual General Meeting. These initiatives
include a reduction in the weighting of the
Short Term Incentive component in total
remuneration, as well as the inclusion of
more objective performance measures
through moving to a balanced scorecard for
all executives.
Remuneration outcomes for the year include
only one member of our Key Management
Personnel (KMP) receiving an increase in fixed
remuneration, and total bonuses paid to KMP
in respect of FY17 being 44% lower than for the
prior year. Fees for Non-Executive Directors
were left at a consistent level for the fifth
consecutive year.
Further remuneration details can be found in our
remuneration report commencing on page 37.
Going forward, while there is still much to do,
we are well positioned to weather the current
difficult market conditions and pursue our
growth opportunities and cost efficiencies. We
have a strong financial foundation, our strategic
initiatives are delivering and there is strong
leadership through your Board and senior
leadership team.
5
#CEO’s Report
Ian Morrice
Chief Executive Officer
CEO’s Report
T he last financial year
was a very challenging
one in many aspects,
including highly competitive
market conditions leading to
increased price deflation, and
market disruption from the
closure of Masters’ hardware
stores. In this context,
there were many facets
of our performance that
were pleasing.
The interests and values of
Mitre 10 and HTH retailers are
closely aligned. Our objective is
to continue to build successful
Independent Retailers and grow
a vibrant independent hardware
sector, for the long term.
6
From a financial perspective, the Group
delivered growth in underlying earnings
and strong cash inflows despite the market
challenges, both creditable outcomes.
Underlying profit after tax increased 9.3% to
$194.8 million, reflecting continued earnings
growth in Liquor, and in Hardware which
benefited from the successful acquisition of
Home Timber & Hardware (HTH). Our Food pillar
delivered earnings in line with the prior year,
despite facing price and new space competition
at levels never before seen in the sector.
Supporting Independent Retailers to be the
‘Best Store in Town’ is central to our strategic
focus, and the past year saw significant
progress on our retailer-centred initiatives.
We, and our Independent Retailers, are very
passionate about driving growth for their
businesses, and I am encouraged to see the
network continuing to invest in both new stores
and upgrades at an increasing rate despite the
difficult market conditions.
In Supermarkets, there were 32 new store
openings in the year, and a further 100 stores
completed the Diamond Store Accelerator (DSA)
refurbishment program. This brings total DSA
completed stores to ~250, with another ~100
expected in FY18. The DSA refurbished stores
are delivering impressive sales growth of well
over 10%, on average.
In Liquor, retailers have continued investing
in the network, with 95 stores completing
the ‘refresh’ program and a further 130 cool
rooms upgraded, both aimed at improving the
shopper experience.
In Hardware, our Sapphire Store Refurbishment
and upgrades and Core Ranging programs are
both delivering strong sales growth. A further
10 stores were upgraded to Sapphire standards
during the year, in line with our target. This
brings the total completed so far to 22. Typically
these Sapphire upgrades deliver greater than
15% uplift in sales per store.
The challenging market and economic
conditions have reinforced just how important it
is that we deliver on our targeted savings from
the Working Smarter program. Simplifying the
way we operate, and at the same time reducing
our costs, is crucial to ensure we remain
competitive and meet the future needs of our
customers, retailers and suppliers. This year we
exceeded our savings target of $35 million, and
I am very appreciative of the significant effort,
understanding and resilience of our people as
we continue to simplify and change the way
we operate.
Importantly, our cash performance for the year
was very strong with operating cash flow of
$304.6 million, an increase of $138.8 million
on the prior year. This was a key driver of a
$194.7 million reduction in net debt to $80.8
million. Debt reduction has been a priority for
us in recent years, being a key component of
our response to challenging market conditions.
This year’s reduction means net debt has now
decreased by ~$690 million since FY14.
The strength of our financial position has
us well placed for future investment in both
growth and initiatives to drive cost efficiencies,
and was a key factor in the Board bringing
forward the recommencement of dividends.
I would like to thank shareholders for their
support in forgoing dividends over the
last two years.
The year was also a very important one in our
history, with the acquisition of the HTH Group.
Combining HTH with our Mitre 10 network
has created the second largest Hardware
business in Australia, with sales of more than
$2 billion per annum. This increased scale
has created significant synergy opportunities,
and enables us to improve our competitive
position and deliver better outcomes for both
our independent Hardware retailers, and their
customers. This acquisition will also be strongly
earnings accretive for shareholders.
Operating performance
The Group generated sales revenue for the year
of $14.12 billion, an increase of 5.4% on the
prior year, which includes sales from HTH since
its acquisition on 2 October, as well as sales
from a 53rd trading week in FY17.
Group EBIT increased 7.7% to $296.7 million,
reflecting continued earnings growth in the
Liquor and Hardware pillars.
In Food, sales increased 0.6% to $9.18 billion.
Excluding the 53rd week, sales were 1.3% lower
than the prior year.
Supermarkets sales increased 1.3% to
$7.65 billion, and were 0.6% lower excluding
the 53rd trading week as the uplift from our
strategic initiatives and new store openings
were more than offset by significant price
deflation, the cycling of sold stores and store
closures, increased competitor promotional
activity, competitor entry into South Australia
and Western Australia, and weak economic
conditions in Western Australia.
Convenience sales declined 2.7% to
$1.53 billion, and were 4.5% down excluding
the 53rd trading week due to the impact of
lower volumes in both C-Store Distribution
and Campbells.
Food EBIT was in line with the prior year at
$180.0 million. In Supermarkets, our Working
Smarter savings enabled us to maintain
margins by offsetting the impact of increased
tobacco sales, which have lower margins. In
Convenience, significant cost reductions from
repositioning the business led to an improved
2H17, with earnings breaking even for the half.
In Liquor, sales increased 3.5% to $3.33 billion,
and were up 1.8% excluding the 53rd trading
week. Our IBA (retail) bannered network
continued to perform well with further
improvement to the quality of stores despite
difficult trading conditions. These included
intense competition driven mainly by the large
retail chains, and weak economic conditions in
Western Australia.
7 CEO’s Report continued
Safety
Metcash continues to have a strong focus
on workplace safety and reducing injury. I am
pleased to report that the Lost Time Injury
Frequency Rate for the year declined to 10.1
for the year, compared with 10.3 in the prior
year. This reflects a decrease in the number of
LTIs to 90, compared with 94 in the prior year.
There was also a 44% reduction in our High
Potential Incident measure for the year, which
was a good improvement.
We are determined to continue reducing
our rate of injury and are driving greater
automation of processes to reduce the risk
of manual handling. We are also continuing
to pursue increased awareness across our
operations around the safety of our people.
Outlook
Group earnings for FY18 will cycle the
inclusion of the 53rd trading week in FY17.
In Liquor, we expect moderate growth in
the overall Liquor market with the business
remaining focused on building and improving
the quality of its IBA (retail) bannered network.
In Hardware, positive market conditions
remain. The business continues to focus on
delivering synergies related to the acquisition
of HTH, and these are expected to be at the
upper end of our targeted range of $15 million
– $20 million (annualised) by the end of
FY18. FY18 will also include a full year of
earnings from HTH.
Our Liquor business’ focus on converting
existing wholesale customers to our IBA
network included the acquisition of Thirsty
Camel in NSW and Tasmania, and Big Bargain
in Tasmania, bringing a combined 79 stores
into the network. We also acquired Porters
Liquor in the second half which added a
further 21 stores to the IBA retail network.
Liquor EBIT increased 7.9% to $67.0 million
reflecting increased sales volumes, improved
margins from the conversion of wholesale
customers to the IBA network, savings from
the Working Smarter program, and inclusion of
the 53rd trading week.
In Hardware, sales increased 52.3% to
$1.61 billion, and includes seven months of
sales from HTH. Mitre 10 sales increased 2.9%,
or 1.4% excluding the 53rd week, underpinned
by our “shopper led” initiatives.
We are making great headway with our
Competitive Pricing program and Digital Data
and Insights initiatives, which are improving
the competitiveness of our retailer network.
Hardware EBIT increased 48% to $48.5 million
reflecting a ~$12 million contribution from
HTH in 2H17, and improved earnings in
Mitre 10 due to increased sales volumes and
cost efficiencies.
Integrating two sizable businesses to
create the Independent Hardware Group
is a significant task. I am pleased to report
that we are in line with our plan to complete
the integration by the end of FY18. Our
achievements to date are a testament to the
quality and effort of our people, particularly
our Hardware team. We have received strong
support and goodwill from Independent
Retailers, which is key to the integration. Other
key areas such as property rationalisation,
forming an integrated management structure,
and merchandising synergies are also
progressing well.
Food
EBIT
$180.0m
Liquor
EBIT
$67.0m
Hardware
EBIT
$48.5m
8
$194.8m
UNDERLYING PROFIT AFTER TAX
In Food, we expect a continuation of the
significant external headwinds experienced
in FY17. The business will continue to
progress initiatives to support Australian
Independent Retailers to be the ‘Best Store
in Town’. We expect Working Smarter savings
to help mitigate the impact of difficult market
conditions including price deflation, cost
inflation and the necessary investment in
new initiatives.
We have good businesses, and very capable,
passionate and enthusiastic people, retailers
and suppliers. We have a strong balance sheet
and see great opportunities ahead in each of
our pillars. I feel very encouraged by what we
have achieved this year, and positive about
what can be achieved in the future.
Our focus also remains on ensuring we continue
to be the partner of choice for suppliers
and Independent Retailers, and this is an
important objective for each of our teams. Our
independent network operates successfully
through a very strong interdependency between
Metcash as the wholesaler, our suppliers and
our retailers.
Competition remains intense, but by working
closely with our supplier partners we can
ensure that Independent Retailers are able to
provide a competitive localised, differentiated
offer that is tailored to their local community,
enabling them to achieve ‘The Best Store in
Town’ for their shoppers.
I would like to sincerely thank all our people
across the Metcash businesses for their
considerable efforts, resilience and commitment
during my time as CEO. It has been a real
privilege to lead such a passionate team who
fight for the success of independent family
businesses every day.
Finally, thank you to all our retail customers
for your passion and belief in being the
‘Best Store in their Town’, and at the heart
of the communities in which you operate.
The success of independent family-owned
businesses is core to our purpose of “Successful
Independents”, and vital to the Australian
economy and communities.
Ian Morrice
Chief Executive
9
#Financial Highlights
Financial Highlights
Strong financial position
$14.12 billion
GROUP SALES REVENUE
$194.8m
UNDERLYING PROFIT AFTER TAX
$304.6m
OPERATING CASHFLOW
$80.8m
NET DEBT
10
,
$
1
4
1
2
1
9
m
.
$
1
9
4
8
m
.
$
2
9
6
7
m
.
2
0
3
c
.
$
3
0
4
6
m
.
($m)
13
14
15
16
17
13
14
15
16
17
13
14
15
16
17
13
14
15
16
17
13
14
15
16
17
Sales Revenue
EBIT (Underlying)
PAT (Underlying)
EPS (Underlying)
Operating cash flows
Financial Performance
Sales revenue ($m)
Underlying EBIT ($m)
Finance costs, net ($m)
Underlying profit after tax ($m)
Reported profit after tax ($m)
Operating cash flows ($m)
Cash realisation ratio (%)
Financial Position
Shareholder equity ($m)
Net debt (hedged) ($m)
Gearing ratio (net hedged) (%)
Return on funds employed (%)
Share Statistics
Fully paid ordinary shares
Weighted average ordinary shares
Underlying earnings per share (cents)
Reported earnings per share (cents)
Dividends declared per share (cents)
Dividend payout ratio (%)
Other Statistics
Number of employees
(full-time equivalents)
1 FY17 includes a 53rd week of trading
20171
2016
2015
2014
2013
14,121.9
13,402.5
13,244.3
13,045.1
12,767.8
296.7
25.5
194.8
171.9
304.6
118%
275.4
27.0
178.3
216.5
165.8
70%
297.3
55.1
173.6
(384.2)
231.7
97%
368.4
57.3
218.4
169.2
388.7
137%
437.7
61.7
261.2
206.0
299.8
94%
1,637.4
1,369.1
1,156.6
1,594.0
1,624.2
80.8
4.7%
18.5%
975.6
958.8
20.3
17.9
4.5
22%
275.5
16.8%
16.5%
928.4
928.4
19.2
23.3
-
-
667.8
36.6%
14.4%
928.4
907.0
19.1
(42.4)
6.5
34%
766.9
32.5%
15.8%
888.3
882.7
24.7
19.2
18.5
75%
719.8
30.7%
19.6%
880.7
859.7
30.4
24.0
28.0
92%
6,708
5,807
6,398
6,174
5,794
11 #Logistics
Logistics
Australia’s leading wholesaler
Major Distribution Centre
Smaller Distribution Centre
12 NRL fields can
fit into one
of our largest
distribution centres
at Huntingwood,
NSW.
We also make it more efficient for
suppliers, whether they operate at
a national or local level, to reach
what would otherwise be a very
diverse and disparate network of
Independent Retailers.
Widest distribution
network in Australia
Our Independent Retail and
wholesale customers are supported
by seven large distribution centres
across the major cities, as well
as smaller distribution centres in
regional areas.
Metcash has the widest retail
distribution network in Australia.
Housing grocery, convenience,
hardware and liquor products, we
service Independent Retailers in all
corners of Australia, including; Cape
York and Cooktown in the North
East, Dampier and Broome in the
North West, Albany and Denmark in
the South West and Tarwin Lower
and Foster in the South East.
Along with capital cities and regional
centres, Metcash also supports
independents in areas that others
don’t reach. We provide products
to some of Australia’s remotest
locations, such as Halls Creek WA,
Coober Pedy SA, Tennant Creek NT,
Cobar NSW to name just a few.
World class wholesale
distribution
Across our people, processes, tools
and systems, Metcash is investing
to ensure that we continue to be
Australia’s leading wholesaler. Key
to our operational excellence is our
investment in automation, with the
introduction of new state of the
art material handling systems in a
number of our distribution centres.
These systems improve safety,
support Independent Retailers by
improving efficiency and optimise
Metcash’s cost to serve equation.
Partner of choice for
retailers and suppliers
There is a very strong
interdependency between Metcash
as the wholesaler, our suppliers and
our retailers. We work closely with
our key supplier partners under a
Vendor Managed Inventory program,
which involves using supplier
intelligence to ensure that we order
optimum levels of stock to support
our retail partners.
Our world class operations in action
Utilising our logistics flexibility
to support the community of
Beechworth
Using our distribution capability
to be ‘first to market’ with
Coca-Cola No Sugar
Partnering with Community
Enterprises Queensland to supply
Thursday Islands
In early 2016, Beechworth Ritchies
IGA was gutted after flames tore
through the building leaving the local
community without a supermarket. To
ensure that residents could continue
to have access to a local supermarket,
a temporary store was quickly created
out of little more than a tin shed.
Ritchies and Metcash teams filled the
temporary store quickly with deliveries
made on a 12 pallet rigid perishable
truck, as the store could only receive
rigid vehicles due to its residential
location. Metcash has been combining
chilled, frozen, dry grocery and liquor
on the one truck 3-4 times per week
since the reopening. The store has
performed very well and the new store
re-build is underway.
Early collaboration between Coca-Cola
and Metcash’s merchandise and
logistics teams and Independent
Retailers, enabled Metcash to be first
to market for the launch of Coca-Cola
No Sugar in June 2017.
The first to market opportunity
involved the delivery of 67,553 cases
and 798 pallets on 37 trucks, which
were delivered within the first five
hours of release. Over half of our
extensive IGA retail network received
Coca-Cola No Sugar within just four
days of the product’s launch.
Metcash in its supply to remote
communities, services the Islanders
Board of Community Enterprises
Queensland (CEQ). We provide CEQ
with approximately 320,000 cases
of dry and perishable goods per
annum for the Torres Straight Island
Communities. We closely partner with
CEQ to facilitate the organisation’s
growth plans.
Trucks travel over
40 million kilometres
per year making
Metcash deliveries to
Independent Retailers
throughout Australia.
M etcash is a
world class
wholesaler
supplying leading
independent retail
brands across
Australia within the
food, grocery, liquor
and hardware sectors.
Our people are our best asset,
and we have around 5,000 of the
company’s ~6,700 employees
working in our wholesale distribution
operations, dedicated to ensuring
the best possible level of service
to our extensive network of
Independent Retail customers.
By combining their buying power we
are able to improve their competitive
position against larger competitors.
We are able to provide Independent
Retailers with a competitive and
efficient scale of operation across
the wide range of products that
we sell.
12
13 #Food
Food
Helping independent retailers thrive
Best stores in town
Super IGA:
IGA:
IGA-Xpress:
Friendly Grocer/Eziway:
Retail
Stores:
397
823
206
257
M etcash has
come a long
way from its
origins in 1924 as a
standalone corner
store in Sydney’s
Wolloomooloo.
Servicing over ~1,680 supermarket
customers through bannered stores
such as IGA, Foodland, Friendly
Grocer and Eziway, Metcash offers
a wide range of core wholesale
grocery, fresh produce, meat, bakery
and deli products.
Our Convenience business
comprises two integrated wholesale
distribution arms established
to service the Australian petrol
and convenience sector across
Australia; Campbells Wholesale &
C-Store Distribution.
‘Best Store in Town’
The consumer is the central player
in all our plans and with an ever
changing retail landscape, Metcash’s
continued focus is to support the
success of our Independent Retail
14
customers, providing them with all
the tools they need to become the
‘Best Store in Town’.
Two key initiatives have been
introduced in recent years with
consumers in mind. Our Price Match
program ensures that our pricing
remains competitive with the
major supermarket chains for both
branded and private label products,
and is now incorporated in ~1,000
supermarkets in the IGA network.
Store environment is also a focus,
and the Diamond Store Accelerator
(DSA) program is a unified store
refurbishment program across the
IGA banner, which aims to improve
the shopping experience for the
customer. This places an increased
emphasis on the amount of floor
space given to fresh produce and
ready-made meals, improves
customer access and the overall
layout of the store. To date over
250 refurbishments have been
completed, and the majority of
participating stores have witnessed
a significant increase in sales
as a result.
Continued investment in the retail
network led to 32 new stores
opening during the year, and another
~35 new stores being in the pipeline
for opening in FY18. Multi-store
owners are also investing in new
store formats that are tailored
to meet the needs of their local
community. Great examples of
these are IGA’s Romeo’s Food Hall in
Sydney’s CBD and Ritchies SUPA IGA
in Dromana, Victoria (see opposite).
Metcash also recently introduced
a new mid-tier private label range
called Community Co. The range
offers 100 new products which
seek to deliver greater value and
quality to consumers while making
a contribution to the community
through the Community Chest Fund.
Earnings performance*
Including the benefit of a 53rd
trading week, our Food business
delivered underlying EBIT for the
year of $180.0 million, in line with
the prior year. Weak economic
conditions in Western Australia
and intense competition led to a
continuation of difficult market
conditions for the business. Sales
improved 1.3% to $7.65 billion, and
pleasingly our IGA retail sales on a
like for like basis were positive for
the third financial year in a row.
*A full review of the financial results is presented in the Operating
and Financial Review on pages 29 to 31 of the Annual Report.
Taylor Road IGA
IGA Romeo’s Food Hall
Ritchies SUPA IGA
Nedlands, WA
Sydney, NSW
Dromana, Victoria
Designed to cater to the needs of city
workers, commuters and people living
in the inner-city, this one-of-a kind
store, located in the business heart of
Sydney, offers their customers a fresh,
variety-driven range of delicious meals
and snacks which they can buy on-
the-go to eat at work or home.
The Romeo’s passion for high quality,
gourmet fresh food and tailored
product has customers coming back
every day – even twice a day!
“This is the next step in retailing for the
Romeo Group. It has been designed with
choice and convenience at its core.”
-Joseph Romeo
James and Rita Kelly’s Taylor Road
store has been designed so that
customers’ five senses compete each
time they walk in the store – colourful
bursts of flowers, freshly brewed
coffee and fresh baked muffins, are
complemented by signature lines, with
the store stocking in excess of 290
locally produced WA products.
The store caters for the lunchtime
and home-ward bound shoppers with
ready-to-go meals including roast
dinners, casseroles, gourmet pies and
delicious salads created by in-house
chefs. The store’s success also comes
from servicing community needs,
and going above and beyond when it
comes to customer service.
“Our success comes through creating an
enjoyable shopping experience for our
local community.”
-James Kelly
The Ritchies’ latest DSA store in
Dromana is an up-market format full
of fresh and unique products that
clearly differentiates them from their
competitors. The store showcases
products such as artisan bread, hand-
rolled sushi, dry-aged beef and even
bespoke peanut butter.
Less than a week after the store
opening, sales were up 50 per cent on
the same time last year as customers
welcomed the up-market selection
of cheese, bread, meat and ready-to-
eat meals.
“With customers shopping up to three to
four times a week, independent stores
are well positioned to benefit due to
their convenient location, but only if the
product range is right.
We continue to see positive results from
the investments in our store network. We
have a focus on further upgrades and will
use the proven DSA program which has
been developed alongside Metcash.”
- Fred Harrison
15
#Liquor
Liquor
Cellarbrations:
Bottle-O/
Bottle-O Neighbourhood:
IGA Liquor:
Other:
Retail
Stores:
553
457
462
1,045
Helping independent retailers thrive
Investing for growth
Best stores in town
M etcash is
Australia’s
largest
broad range liquor
wholesaler.
Our Liquor pillar has two divisions;
Australian Liquor Marketers (ALM)
and Independent Brands Australia
(IBA). The liquor division and its
related businesses operate out of
15 distribution centres located in
each state and territory in Australia,
and in New Zealand.
Australian Liquor
Marketers (ALM)
ALM is a broad range liquor
wholesaler supplying approximately
12,000 hotels, liquor stores,
restaurants and other licensed
premises throughout Australia. It
also has a specialist on-premise
liquor division supplying bars, pubs,
restaurants and hotels.
16
Independent Brands
Australia (IBA)
Our IBA banner group is the second
largest retail group in Australia. It
includes strong national brands
with a framework that enables
independent liquor retailers to
compete equally with larger
competitors, and support their
long-term sustainability. We do
this through group buying power,
providing strong marketing support
and promotional programs,
and through a wide variety of
retail services to ensure high
store standards.
Our IBA network includes 2,517
stores across brands such as
Cellarbrations, The Bottle-O, IGA
Liquor, Duncans, Thirsty Camel, Big
Bargain and Porters. In FY17, sales
to the IBA network represented
~55% of Liquor pillar sales.
Both ALM and IBA work to support
Independent Retailers provide end
customers with a competitively
priced, extensive liquor range.
This includes providing the most
efficient and cost effective supply
chain possible.
‘Best Store in Town’
The smaller store format, and
localised product range of our IBA
retailer network, continue to position
our network well for the shopper
trend of buying smaller quantities
per visit, but shopping more often.
Our product range is tailored
to reflect our local customers’
requirements from both a range and
price perspective, and there is a key
focus on providing shoppers with
knowledgeable friendly service.
The network continues to invest in
improving the shopper experience,
and FY17 saw a further ~95 stores
complete the store refresh program,
and ~130 stores underwent
upgrades to their cool rooms.
Earnings performance*
Our Liquor business continued to
grow earnings with EBIT up 7.9% to
$67.0 million for the year.
Sales increased 3.5% to $3.33
billion and like-for-like sales in our
IBA bannered network increased
1.7%. The IBA bannered network
has recorded sales at a compound
annual growth rate of ~7% over the
past three years.
Investing for growth
We continued to focus on converting
existing wholesale customers to our
IBA network as well as progressing our
consolidation strategy. This included
the acquisition of Thirsty Camel in NSW
and Tasmania, Big Bargain in Tasmania,
and the acquisition of Porters Liquor.
IBA will continue to apply the best
retail offer by location to maximise
the sales of our independent
retail customers.
Porters Liquor
Porters Liquor is a well-recognised
premium brand, positioned to capitalise
on the growing trend to higher quality
products. It now forms part of our IBA
banner group, and provides significant
growth opportunity for our Liquor
business. This includes a potential
expansion in store footprint from 30 to
around 100 nationally.
Montrose IGA Plus
Liquor
The Bottle-O Wyee
Cellars
Montrose, VIC
Wyee NSW
Based at the foot of the Yarra Valley,
Brad Munro has transformed IGA
Montrose into a destination store
for shoppers looking for premium
wine, spirits and craft beer local to
that region. The personalised service
shoppers get from the Montrose
IGA team, showcases their product
knowledge, and along with their newly
launched ‘Cellar Selections’ premium
range, shoppers now have access to a
truly localised offer.
“We sought to be the best liquor store in
the area, and have achieved this through
the creation of our differentiated localised
offer, together with personalised service
and in-depth knowledge on products,
especially local wines, beers and spirits.”
- Brad Munro
Chris Jameson recently relocated
and renovated her Bottle-O store at
Wyee, NSW to the highest standard,
and it is now a standout at the Wyee
community shopping centre. The new
store has an extended product range
tailored to the local community, and
together with high service levels, is
attracting significantly more customers
than when operating from the original
store. The upgraded store has now
become a repeat finalist in the NSW
IBA Bottle-O of the year awards.
“Our new store is proving very popular
with local shoppers and we have seen
sales grow more than 25%. Staying close
to our customers and market trends, and
having the flexibility to adapt is key to
our success.”
- Chris Jameson
*A full review of the financial results is presented in the Operating
and Financial Review on pages 29 to 31 of the Annual Report.
17
#Hardware
Hardware
Mitre 10:
HTH and related brands:
True Value Hardware:
Retail
Stores:
372
368
67
Helping independent retailers thrive
Best stores in town
I n October 2016,
Metcash purchased
the Home Timber
& Hardware Group
which, combined
with our Mitre 10
business, created the
second largest player
in the Australian
Hardware market.
The combined business, named
the Independent Hardware Group
(IHG) is a wholesaler and distributor
with sales of more than $2 billion,
servicing ~740 bannered stores and
over 500 un-bannered stores. It is
the largest channel of independent
home improvement and hardware
operators in Australia, with trade
sales as its strength.
Our store network ranges from
large format warehouses to smaller
format convenience operations,
trade centres and frame and truss
sites, each catering to a broad mix of
trade and DIY consumers.
Under the IHG network, we have
a clear mandate to support the
growth of Independents within the
hardware sector in Australia. Our
culture is built on being a low-cost
and transparent business partner
to our members. Partnership is also
the culture on which the relationship
with our suppliers is founded.
‘Best Store in Town’
IHG is committed to supporting our
independent store owners to be
‘The Best Store in Town’. This means
having a differentiated store offer
that includes being locally owned,
with a tailored ‘shopper led’ range
of competitively priced products,
together with superior customer
service and convenient store layouts
with high standards.
The rollout of our Sapphire Store
Refurbishment program in Mitre
10 continued during the year, with
investment in a further 10 stores.
This takes the total stores upgraded
to Sapphire standard to 22, with the
average sales uplift for these stores
~17%.
Our Core Ranging program, which
includes offering customers more
choice, has now been implemented
in over 50 stores and is delivering
strong sales growth across key
ranges such as fasteners, hand
tools, power tools, paint and
cement.
Earnings performance*
Our Hardware business continued to
deliver earnings growth with EBIT of
$48.5 million for the year, up from
$32.8 million in the prior year. This
included $12 million of EBIT from
HTH for the period since acquisition,
and increased earnings in Mitre 10.
18
*A full review of the financial results is presented in the Operating
and Financial Review on pages 29 to 31 of the Annual Report.
Johnson Brothers
Mitre 10
Womersley’s
Mitre 10
Provans Home Timber
and Hardware
Mona Vale NSW
Chelsea VIC
Clifton Hill VIC
Johnson Brothers have been servicing
Sydney’s local Northern Beaches
community for over 60 years. This
year they opened a new ‘Best Store in
Town’, relocating their existing store
to larger premises to cater for their
growing Trade and DIY business.
In addition to its high store
standards and ‘shopper led range’
of competitively priced products,
the site now has separate trade
and retail entrances, an undercover
drive through, a trade paint offer,
and a garden centre as well as 150+
parking spots.
“Our upgraded store format is proving
very popular with customers and we are
seeing good sales growth”
- Ged Johnson
The Womersley family is one of the
founders of the Mitre 10 business.
With their Chelsea store positioned in
close proximity to a large Hardware
chain competitor, the family embarked
on a transformation of the store
through Metcash’s Sapphire program in
2016 to improve its competitiveness.
The store has experienced good
growth through its focus on high
store standards, including providing
‘Mighty Helpful’ service and having
a strong differentiated offer for its
trade customers.
“With competition close by, our Sapphire
store upgrade and our strong trade
offer are helping deliver a competitive
business that is tailored to our local
customer base.”
- Peter Womersley
With its origin dating back to the
1880s, the Provans store has been
in Barry Rosenburg’s family for
more than two generations. Barry’s
store became part of the IHG Group
following the acquisition of HTH last
October, and is a great example of
being the ‘Best Store in Town’. Provans
has a reputation for being the leading
supplier to the trade in Melbourne
for restoring heritage houses. Around
90% of the stores sales are to trade
customers, and the store is ideally set
up to ensure its extensive timber offer
remains under cover during collection,
and that tradies can move through the
site quickly.
The high level of service, product offer
and store standards saw Provans
awarded Home Time & Hardware’s
“Store of the Year” in 2017.
“We recognise the benefits of scale
and are pleased to be part of the larger
IHG network”
- Barry Rosenberg
19
#Corporate Social Responsibility
#CSR
Corporate Social Responsibility
Supporting local communities
T he Metcash
business has
always been
driven by its strong
connection to the
communities we serve.
For us, good Corporate Social
Responsibility is about our role
within the broader community, our
connections within it and supporting
our locals to be the heart and soul of
communities right around the country.
We focus on having an integrated
approach to community initiatives,
partnering with our customers,
suppliers and people to strengthen
our level of engagement.
We acknowledge responsibility for
the impact our business operations
may have on the environment, and
continue to pursue opportunities to
reduce this.
Our communities
A key element of our vision is to
support communities to thrive.
Engaging and supporting our
communities and our customers to
help deliver this vision is an integral
part of what we do.
Our support includes financial
donations through our Independent
Retailer network, the donation of staff
time, and the donation of food and
products to those in our communities
who are most vulnerable.
Our Independent Retailer network
has donated over $80 million into
local communities over the past 25
years through the Community Chest
Fund. This has supported over 7,000
charities at a national, state and local
level, including schools, sporting clubs,
country fire services, hospitals and
disaster relief services.
20
Many communities have benefited
from the purchase of much needed
medical equipment, school equipment,
local fire-fighting equipment as well
as through disaster relief support such
as food and gift vouchers.
During the year, IGA’s across NSW
and the ACT donated $150,000 to
the Humpty Dumpty Foundation
to support the purchase of medical
equipment for hospitals. In Victoria,
the IGA network donated $50,000 to
the Royal Children’s Hospital Good
Friday Appeal.
The IGA network has a proud history
of supporting local communities in
times of need. During the year, the
Queensland IGA network donated
$100,000 in gift cards to residents
affected by Cyclone Debbie. In the
worst impacted areas, IGA West
Mackay, SUPA IGA Sarina, SUPA IGA
Bowen and SUPA IGA Proserpine
donated our Community Co water
and UHT long life milk to local SES
centres to assist those impacted by
the cyclone.
At a national level, we have long-
standing support partnerships with
the Special Olympics, St Vincent de
Paul and the McGrath Foundation. All
three charities received both in kind
support through staff volunteerism, as
well as financial support.
We also have a long-standing
partnership with Foodbank. Foodbank
rescues surplus but edible food and
groceries from the country’s farmers,
manufacturers and retailers, and
donates this to over 2,600 charities
and 1,750 schools. Since 2012,
Metcash has donated over one million
kilograms of food to Foodbank.
Living healthier lives –
promoting healthy families
and healthy communities
As we aspire to be healthier and
happier, it is important that we deliver
nutritious healthy food options,
as well as supporting educational
materials on food and living a
healthy lifestyle.
Under the IGA Family Program, we
strive to support local communities
by providing members with tools
to promote healthy lifestyles for
a healthier, happier Australia. This
includes providing communities with
access to healthy and affordable
recipes, arts and craft activities that
encourage creativity and recycling,
fact sheets to teach children about
the origins of food, as well as special
offers to help our members shop to a
budget.
Since the program’s inception one
year ago, over 16,000 families
have become members of the IGA
Family Program.
Special Olympics - celebrating a 25 year partnership with IGA
Sallie Jones from Gippsland Jersey, our IGA Family
program Ambassador, providing members with
nutritious recipes using milk from her farm
Safety and wellbeing
The safety and health of our people,
contractors and visitors is at the core
of everything we do. We continue
to strive for improvement and to be
world class in safety.
During the year we implemented
additional initiatives to improve
our safety performance, including
progressing greater automation
of processes to reduce the risk of
manual handling, as well as increasing
awareness across our operations
around the safety of our people,
contractors and visitors.
Our Lost Time Injury Frequency Rate
(LTIFR) reduced to 10.1 for the year,
from a LTIFR of 10.3 in the prior year .
This reflects a decrease in the number
of LTIs to 90, compared with 94 in the
prior year. There was also a significant
reduction in our High Potential
Incident measure, which reduced
from 63 incidents in the prior year to
35 in FY17.
In addition to safety, the wellbeing
of our people is a top priority.
Reflecting this, the company provides
the opportunity for employees to
access a range of employee benefits
to promote the wellbeing of our
employees. These include wellbeing
leave days, volunteering days, flexible
working arrangements, counselling
services, paid parental leave and
allowing eligible employees to access
an additional week of leave per year.
25
20
15
10
5
0
250
200
150
100
50
0
12
13
14
15
16
17
12
13
14
15
16
17
Lost Time Injury Frequency Rate
Lost Time Injuries
The LTIFR for FY16 has been restated from
8.5 to 10.3 following a review of our safety
statistics reporting carried out by PwC.
21 IGA Marketing team volunteer day helping to support Vinnies
Metcash donates to Foodbank
IGA Retailers supporting the Humpty Dumpty
Foundation through Community Chest donations
Energy and emissions
Waste and packaging
Our energy savings initiatives
have delivered a 6.3% reduction in
emissions at our Distribution Centres,
which account for the majority of the
company’s energy consumption.
The driver of this improvement was
the implementation of a number of
energy savings projects, including
LED lighting retrofitting and the
implementation of monitoring
programs to review energy usage on a
regular basis.
Energy reduction is an ongoing priority
for us, and we are optimistic that
further opportunities will arise through
the use of more energy efficient
technologies that are currently
under review.
Waste and its diversion to recycling
is an important area of focus for our
business, and we are proud to play
a stewardship role in these areas.
We are committed to the Australian
Packaging Covenant, and continue
to work closely with our partner
suppliers to reduce the volume of
product packaging.
Our programs to increase the
amount of material that is recycled,
rather than being sent to landfill, are
delivering good results. This year we
diverted ~16% of waste from landfill.
We are committed to improving
our performance in these areas,
and further opportunities are being
developed by work teams, primarily at
our distribution centres.
Diversity, inclusion and
our people
Inclusion and diversity are
fundamental to our culture and
core values. We recognise that
each person has unique strengths,
and that high performance
is underpinned by embracing
those strengths.
In addition to being a member of
the Diversity Council of Australia
(DCA), the company has established
a Diversity and Inclusion Council that
is responsible for driving greater
awareness of diversity and inclusion
across the organisation, as well as
creating a comprehensive action
plan for the Metcash group.
We believe that encouraging
diversity will contribute to high
performance by driving business
results, encouraging greater
innovation, and by attracting,
recruiting, engaging and retaining a
diverse team of high quality people.
The Metcash workforce is currently
comprised of 33% females and
67% males. Women now hold 30%
of all senior manager roles in the
company. Woman account for 43%
of the Metcash Board of Directors,
which is well ahead of the ASX
200 average.
Sourcing with integrity
As a business we are responding
to the expectations of our
communities, this has been
evidenced by the launch of the
Community Co brand during the
year which seeks to deliver greater
value and quality to consumers.
Fundamental to this is ensuring
that our products are developed
in accordance with expectations
including responsible sourcing.
Our progress in responsible sourcing
included the following during
the year:
>
>
>
>
>
Use of 100% Certified
Sustainable Palm Oil (CSPO)
across our private label brands.
This includes a mix of mass
balance and segregated palm
oil.
Sourcing the majority of our
Tuna using sustainable fishing
methods (FAD Free)
Ensuring that 100% of our
private label brand tissues,
toilet paper and kitchen towels
are sourced from third-party
certified sustainable sources
The introduction of sow stall
free pork in our Community Co
range
Significant progress towards
our target of achieving 100%
cage free eggs in our private
label brands by 2018
We are a member of the Roundtable
on Sustainable Palm Oil (RSPO), and
continue to work with our suppliers
to ensure that Palm Oil used in
our private label products is from
sustainable sources.
Our environment
We are committed to reducing our
impact on the environment, and
work with our people, suppliers
and customers to identify areas for
improvement.
We report annually against a
number of compulsory and voluntary
programs, including:
>
>
>
>
>
Dow Jones Sustainability Index
(DJSI)
Carbon Disclosure Project (CDP)
National Greenhouse and
Energy Reporting Act (NGERS)
Australian Packaging Covenant
(APC)
Western Australian Waterwise
Business Program
There were no breaches of
environmental laws or regulations in
the year.
22
23 #Our people
#Our board
Our people
Senior management
Our board
Ian Morrice
MBA
CEO
Metcash Group
Ian has over three decades of
retail experience as Managing
Director, Trading Director
and Retail Director for some
of the UK’s leading retailers,
including the Kingfisher
Group and Dixons Retail. Ian
was Group Chief Executive
Officer and Group Managing
Director of New Zealand’s
Warehouse Group.
Steven Cain
M.Eng
CEO
Supermarkets & Convenience
Steven joined Metcash in
2015 with significant local
& international business
experience through previous
directorships at Coles, Asda
(UK), Pacific EquIty Partners &
ITV (UK).
Steven has attended
management programs at
Harvard & London Business
Schools, and has a Master of
Chemical Engineering Degree
from Imperial College London.
Mark Laidlaw
B.Ec, CPA
CEO
Independent
Hardware Group
Mark joined Metcash in 2001
and was appointed CEO of Mitre
10 Australia in May 2010.
Mark has extensive experience
in general management, sales,
operations and commercial
management and prior to
joining Metcash, Mark worked
for Mobil Oil.
Scott Marshall
B.Business
CEO
Australian Liquor
Marketers
Scott began his career
with Metcash in the ALM
business 24 years ago and
was appointed CEO of ALM in
December 2013.
His areas of experience cover
warehousing operations
and management, sales,
retail operations, state
general management and
marketing management.
Robert Murray
MA Hons, Economics (Cantab)
Ian Morrice
MBA
Patrick Allaway
BA, LLB
Non-executive Chairman
CEO, Executive Director
Non-executive Director
Chair of the Nomination
Committee.
Chair of the Audit, Risk &
Compliance Committee,
Member of the Nomination
Committee.
Fiona Balfour
BA (Hons), MBA, Grad Dip IM,
FAICD
Non-executive Director
Chair of People & Culture
Committee, Member of the
Nomination Committee.
Brad Soller
B.Comm, B.Acc, M.Comm, CA (SA)
CFO
Metcash Group
Brad joined Metcash in
January 2015 and prior to
that was the CFO of David
Jones and CFO of Lendlease.
Brad is a Chartered
Accountant having worked
with PwC in both London
and Johannesburg.
Linda Venables
B.Sc Hons
Edwin Gear
B.Sc, MBA
Penny Coates
BA Hons, Chartered Fellow CIPD, GAICD
Chief Logistics Officer – Food &
Liquor
Linda started with Metcash
in October 2013 and was
appointed Chief Logistics Officer
in February 2015.
Linda’s career spans both
FMCG and Retail, including 3rd
party logistics in Europe and
the Australian retail market.
Linda also has extensive
systems implementation,
program management and
M&A experience.
Chief Information Officer
Chief People & Culture Officer
Edwin joined Metcash in 2014
and was appointed as Group
CIO in April 2015. Edwin is
responsible for IT’s cross-
functional collaboration with
group companies.
Before joining Metcash Edwin
held various executive roles in
merchandising, logistics and
technology with Foodstuffs
Wellington and Mitre10 in New
Zealand and Supergroup in
South Africa.
Penny joined Metcash in 2015
as Chief People & Culture Officer.
Penny has extensive international
HR and line management
experience gained in the retail,
financial services and professional
services industries.
Prior to joining Metcash
Penny worked for TAL as their
Chief Customer Service &
Operations Officer.
Tonianne Dwyer
BJuris Hons, LLB Hons, GAICD
Non-executive Director
Member of the Audit, Risk
& Compliance Committee,
Member of the Nomination
Committee.
Murray Jordan
MPA
Non-executive Director
Member of the Audit, Risk
& Compliance Committee,
Member of the Nomination
Committee and People &
Culture Committee.
Helen Nash
BA Hons, GAICD
Non-executive Director
Member of the People
& Culture Committee,
Member of the Nomination
Committee.
Julie Hutton
B Asian Studies (Viet), LLB, LLM,
GAICD
Company Secretary
For Directors’ biographies, please see page 34 of the Annual Report. For more information
on Board evaluation, please refer to the Corporate Governance page on our website:
www.metcash.com/corporate-governance
24
25 #Financial Report
Financial Report
For the year ended 30 April 2017
Contents
Directors’ Report
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Auditor’s Independence Declaration
Independent Auditor’s Report
27
54
55
56
57
58
96
97
98
26
For the year ended 30 April 2017
Directors’ Report
•
•
•
•
27
Directors’ Report (continued)
For the year ended 30 April 2017
28
29 Directors’ Report (continued)
For the year ended 30 April 2017
30
31 Directors’ Report (continued)
For the year ended 30 April 2017
32
33 Directors’ Report (continued)
For the year ended 30 April 2017
34
35 Directors’ Report (continued)
For the year ended 30 April 2017
36
37
Directors’ Report (continued)
For the year ended 30 April 2017
•
•
•
•
•
•
•
•
•
•
•
38
39
Directors’ Report (continued)
For the year ended 30 April 2017
•
•
•
•
•
•
•
•
•
40
41
Directors’ Report (continued)
For the year ended 30 April 2017
•
•
•
•
42
43
Directors’ Report (continued)
For the year ended 30 April 2017
44
45
Directors’ Report (continued)
For the year ended 30 April 2017
46
47
Directors’ Report (continued)
For the year ended 30 April 2017
48
•
•
•
•
•
•
•
49
Directors’ Report (continued)
For the year ended 30 April 2017
50
51
Directors’ Report (continued)
For the year ended 30 April 2017
97
52
53
Statement of comprehensive income
For the year ended 30 April 2017
Statement of financial position
As at 30 April 2017
54
55
Statement of changes in equity
For the year ended 30 April 2017
Statement of cashflows
For the year ended 30 April 2017
56
57
Notes to the financial statements
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
58
59
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
60
61
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
62
63
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
64
65
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
66
•
•
•
67
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
68
69
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
70
71
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
•
72
73
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
74
75
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
76
77
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
78
79
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
•
•
•
•
•
80
81
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
82
83
Notes to the financial statements (continued)
For the year ended 30 April 2017
84
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
85
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
86
87
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
88
89
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
•
•
•
•
90
•
•
•
91
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
92
93
Notes to the financial statements (continued)
For the year ended 30 April 2017
Notes to the financial statements (continued)
For the year ended 30 April 2017
94
95
Directors’ declaration
For the year ended 30 April 2017
96
97
98
99
100
101
•
•
•
•
•
•
39
52
102
103
ASX Information
Year ended 30 April 2017
Corporate Information
ABN 32 112 073 480
Additional information required by the Australian Securities Exchange and not shown elsewhere in this report is as follows:
The information is current as at 30 June 2017:
Distribution of Equity Securities
The number of shareholders, by size of holding, in each class of share is:
Size of Holding
1-1,000
1,001-5,000
5,001-10,000
Number Of Shareholders
Size of Holding
Number Of Shareholders
6,445
11,990
4,407
10,001-100,000
100,001-9,999,999,999
Total
3,731
156
26,729
There were 1,414 shareholders holding less than a marketable parcel of Metcash ordinary shares.
Twenty largest holders of quoted shares
The names of the 20 largest holders of quoted shares are:
Number Of Shares
Percentage Of Shares
Name
HSBC Custody Nominees
J P Morgan Nominees Australia
Citicorp Nominees Pty Limited
National Nominees Limited
BNP Paribas Nominees Pty Ltd
BNP Paribas Noms Pty Ltd
Bond Street Custodians Limited
HSBC Custody Nominees
Citicorp Nominees Pty Limited
BNP Paribas Nominees Pty Ltd
Buttonwood Nominees Pty Ltd
RBC Investor Services
UBS Nominees Pty Ltd
Bainpro Nominees Pty Limited
HSBC Custody Nominees
Ecapital Nominees Pty Limited
Bond Street Custodians Ltd
National Nominees Limited
HSBC Custody Nominees
Powerwrap Limited
Total
Substantial Shareholders
The following is extracted from the Company’s register of substantial shareholders:
Number Of Shares
Allan Gray Australia Pty Ltd
148,303,522
Macquarie Group Limited
BT Investment Management Limited
124,840,430
Dimensional Equities
Lazard Asset Management Pacific Co
60,146,842
JPMorgan Chase & Co.
Voting Rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
104
394,056,393
154,760,650
104,491,061
37,876,122
23,168,728
19,701,687
9,158,056
8,623,107
7,899,631
4,950,000
4,400,000
4,337,923
3,759,613
2,043,954
2,013,641
1,841,874
1,477,298
1,396,324
1,284,713
998,219
788,238,994
40.389%
15.862%
10.710%
3.882%
2.375%
2.019%
0.939%
0.884%
0.810%
0.507%
0.451%
0.445%
0.385%
0.209%
0.206%
0.189%
0.151%
0.143%
0.132%
0.102%
80.792%
Number Of Shares
59,492,070
48,864,690
48,853,745
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D
Directors
Robert Murray (Chair)
Ian Morrice (Group CEO)
Patrick Allaway
Fiona Balfour
Tonianne Dwyer
Murray Jordan
Helen Nash
Company Secretary
Julie Hutton
Share Register
Boardroom Pty Limited
GPO Box 3993
Sydney NSW 2001
1300 737 760
61 2 9290 9600
Auditor
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
Metcash Food & Grocery
(Head Office)
1 Thomas Holt Drive
Macquarie Park NSW 2113
61 2 9741 3000
PO Box 557
Macquarie Park NSW 1670
Australian Liquor Marketers
(Head Office)
1 Thomas Holt Drive
Macquarie Park NSW 2113
61 2 9741 3000
PO Box 557
Macquarie Park NSW 1670
Independent Hardware Group
(Head Office)
15 Corporate Drive
Heatherton VIC 3202
61 2 9248 5555
61 3 9264 5000
National Office
1 Thomas Holt Drive
Macquarie Park NSW 2113
PO Box 557
Macquarie Park NSW 1670
61 2 9741 3000
www.metcash.com
Locked Bag 10
Doveton VIC 3177
Corporate Governance
A copy of the Corporate Governance
Statement can be found on our
website. Visit www.metcash.com/
investor-centre/corporate-information/
corporategovernance.
105
www.metcash.com