👉 Background: Coles Group is the company that owns major Aussie supermarket giant Coles, as well as nearly 1,000 liquor stores under the Liquorland brand. Over the past 12 months, Coles has made a big push to chase market leader Woolies and has doubled down on its Down Down campaigns and its private label brands.

👉 What happened: It was good news for Coles Group’s sales as it lifted 1.7% to $44.5 billion. But, its Coles Group net profit dipped 3.5% - largely due to a drop in earnings from Liquorland and tobacco, which suffered a 30% drop in revenue.

👉 What else: Despite the fall in net profit, Coles' shares jumped more than 8%. Sounds strange. But on a normalised basis, Coles Group’s sales were actually up 3.6% and profits up 2.4%. The key driver? Its premium private label range under the "Coles Finest" range.

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‍What's the key learning?

💡Not all financial years are created equal, especially in the supermarket-game, where some years stretch to 53 weeks. This is why Coles also reported their “normalised” financial results to investors.  

💡Normalised figures strip out unusual factors, like an extra trading week. These figures give investors a clearer view of a company’s performance. And, this matters more for retailers like Coles because they report results in weekly periods (as opposed to banks and other industries that report in months).  

💡While the last time Coles reported on a 53-week basis was in FY24, it doesn't typically happen so often. In fact, prior to FY24, the last 53-week year was FY19. That’s why analysts look at “normalised” numbers to show true performance. And they liked what they saw.