Australia’s Coles posts 4% drop in annual profit

(Reuters) -Australia’s Coles Group reported a lower-than-expected annual profit on Tuesday, as higher operating and financing costs alongside lower tobacco sales offset strong sales growth at its Supermarkets division.

The country’s second-largest grocer reported net profit after tax attributable to shareholders of A$1.08 billion ($701.78 million) for the year ended June 29, compared with A$1.12 billion a year earlier.

That missed the Visible Alpha consensus estimate of A$1.11 billion.

Sales revenue at Coles’ Supermarket division, which accounts for the bulk of the group’s earnings, rose 4.3% to A$39.99 billion on a normalised basis. Excluding tobacco, sales revenue grew 5.7%.

The more than 100-year-old Melbourne-based retailer declared a final dividend of 32 Australian cents per share, the same as what it paid last year.

($1 = 1.5389 Australian dollars)