Endeavour F26 Underlying NPAT Down 14.8%, DPS Down 36.2%

Endeavour Group (ASX:EDV) reported group sales of $12.2 billion for the 52 weeks ended 28 June 2026, up 1.3% on F25. Group underlying EBIT fell 8.7% to $845 million, which the company attributed to the lower EBIT contribution from its Retail business and the impact of cost inflation on cost of doing business. Underlying net profit after tax was $363 million, down 14.8%, while statutory net profit after tax was $52 million, down 87.8%, after a net expense of $372 million pre-tax related to Significant Items, or $311 million after tax. The Significant Items comprised $194 million relating to portfolio rationalisation and asset impairments, $80 million of write-downs of non-current assets, $58 million of restructuring and strategic review costs and a $40 million provision relating to the Melbourne Liquor Distribution Centre. The Board declared a fully franked final dividend of 1.2 cents per ordinary share which, combined with the 10.8 cent interim dividend, takes the full year dividend to 12.0 cents per share, down 36.2% on F25 and equating to an underlying full year dividend payout ratio of 59% under a policy revised during the year to between 50% and 75% of underlying net profit after tax. Underlying operating cash flow was $933 million at a cash realisation rate of 93%, within the company's guided range of 90% to 110% but 17 percentage points below F25, and net debt rose $198 million to $1.9 billion, an underlying leverage ratio of 1.9x on a pre-AASB 16 basis or 3.8x post-AASB 16.

Retail sales rose 0.7% to $10.0 billion, with Dan Murphy's and BWS sales up 1.0% to $9.8 billion and comparable store sales up 0.5%; combined sales growth for the two brands increased from 0.7% in the first half to 1.4% in the second half. Retail underlying EBIT fell 17.6% to $464 million at an EBIT margin of 4.6%, with underlying gross profit margin down 86 basis points, which the company attributed to investment in lower shelf prices and elevated levels of promotional activity market-wide. Online sales grew 34.8% to $1.1 billion, representing 11.6% of combined Dan Murphy's and BWS sales. Hotels sales rose 4.2% to $2.2 billion with comparable sales up 4.4%, and Hotels underlying EBIT rose 4.1% to $462 million at an EBIT margin of 21.0%, with 38 venues upgraded and approximately 2,000 new electronic gaming machines installed during the year. For the first seven weeks of F27, sales growth was 4.6% for Retail and 2.2% for Hotels, or 2.0% excluding the estimated uplift in July Hotels sales from one-off events including the FIFA World Cup. Endeavour reaffirmed a cost-out target of $300 million by F29 including $100 million in F27, and said it expects F27 capital expenditure of between $550 million and $650 million, finance costs inclusive of lease and debt interest expense of between $330 million and $340 million based on interest rates current at the date of the announcement, and group cost of doing business higher than F26. The company said Hotels sales growth has softened in the first half of F27 to date across food and beverage, gaming and accommodation, and that disruption to trading from increased renewal activity is expected to adversely impact Hotel earnings in F27.