Mitre 10 the star performer.
As a result of highly competitive trading conditions, Metcash Group earnings before interest and tax (EBIT), was down 4% to $128.1 million, while sales for the Group inched up 0.3% for 1H17. Despite this, EBIT for hardware increased by 7.8% with a solid performance from Mitre 10. Sales in hardware were also lifted by 9.6% during the reported period.
The HTH acquisition was completed on October 2, 2016. Metcash Group CFO, Brad Soller said 1H17 included three weeks of HTH trading, contributing to $51 million in sales, although there was no material contribution to earnings in 1H17.
Metcash Group CEO, Ian Morrice
2H17 EBIT contribution from HTH is anticipated to be over $10 million, excluding integration costs. The company has set a synergy target of between $15 million and $20 million annually by the end of FY18, after sharing benefits with retailers.
In a statement to the ASX, Metcash said that the integration is progressing well with the initial focus on consolidating the support office and distribution centre; inventory review and core ranging, as well as systems integration.