Super Retail Group’s May 2026 trading update shows a meaningful slowdown in sales, particularly in BCF and Supercheap Auto. These two businesses are more directly impacted by the spike in petrol and diesel prices. We expect soft sales trends to persist into FY27e, but also see gross margin gains from a stronger Australian dollar, self-help in Rebel and distribution centre benefits flowing through to earnings. We expect to hear more on these topics at Super Retail Group’s strategy day on 11 June 2026.

Inghams will hold a strategy day on 11 May 2026. The last strategy day in November 2023 failed to hit the mark given the loss of Woolworths volumes highlighted its vulnerability. On this occasion, we expect Inghams to be, rightly, less ambitious and more focused on improved execution. EBITDA margins are likely to land at 6.0% in FY26e, flat on the modest level achieved in FY23. A return to decent volume growth and improved margins is needed.

Endeavour Group’s 3Q26 trading update revealed slower sales trends with an enticement of $100 million in cost savings in FY27e as a benefit. The reality is that sales trends are insufficient for cost savings to drop through to earnings. We expect Endeavour to continue gaining market share given First Choice could close, but a recovery in market growth is more important in our view, which may take time as retail liquor reverts to slight per capita volume declines.

Accent Group has downgraded FY26e guidance. The downgrade to reported EBIT of 8% at the mid-point is attributed to geopolitical unrest. A cost out programme for FY27e and an ASIC investigation into staff share transactions were announced. Accent Group sentiment is lower as a result of the post Covid slump in earnings, management uncertainty and risk of execution for the Sports Direct roll out.

Coles reported 3Q26 sales growth of 3.1%. While 3Q26 sales lagged its rival, Coles Supermarket track-record has been superior to rivals and the market over the past three years. Its Supermarket growth rate is likely to converge with Woolworths over the next nine months in our view. In Liquor, Coles rebranding has not delivered any earnings improvement and former First Choice stores could be shut down in our view. Coles looks to have enough flexibility to manage the fuel price and inflationary pressures near-term. The more important debate will be the ability of the two major supermarkets to ensure ongoing healthy rates of sales growth, which should occur as food inflation accelerates over the next year.

Australian retail sales rose 5.7% year-on-year in March 2026, which is an improvement on February growth, despite the spike in petrol prices and interest rates. It is noteworthy that discretionary categories like department stores and fashion did well. Cafes, restaurants and takeaway food sales were also strong. We expect some dip in April, but only by 1-2 percentage points, which suggests consumer spending is yet to slow much in response to economic headwinds. The slowdown will take time and be more evident in the December 2026 half-year in our view.

Woolworths 3Q26 sales growth of 4.5% was solid across all segments. Even so, the company has lowered its earnings guidance on higher fuel prices and a decision to absorb cost increases on supermarket essentials over the next three months. It is clear that Woolworths top priority is improving its price perception with shoppers. We expect sales trends to slow as the unwind of strike impacts is bigger than the inflation pick-up over the next six months. We see a decent earnings path for FY27e as Woolworths benefits from further cost savings and simplification.

Amazon’s Australian 2025 results show an even larger increase in sales for last calendar year. We estimate its gross transaction value was $9.1 billion, an increase of 31%. Amazon accounted for over one-fifth of the non-food industry’s growth last year. Put differently, it detracts about one percentage point of growth from the rest of the non-food retail industry. Amazon continues to lift marketing spend and Prime subscriber numbers too. Amazon is a classic long-term structural challenge for retail, not an overnight disruption. It is likely to continue at its current pace for at least another three years given its supply chain capacity. The threat to incumbent retailers will remain a gradual squeeze, not a crush of profit margins.

Australian inflation lifted to 4.6% year-on-year as at March 2026. Across the quarter, inflation was 4.1%, up 50bp from the December 2025 quarter. In retail, price inflation ticked up by 30bp in the March 2026 quarter, driven by higher prices in clothing, footwear and furniture. We could see another 50-80bp of inflation in retail over the next year, skewed towards food categories as higher oil prices and oil-derived inputs flow through. Non-food inflation, excluding electronics, is likely to sustain very low inflation. The divergence in food inflation and non-food inflation will influence the retail sales growth path of both sub-sectors.

Coles and Woolworths upcoming sales results may be of passing interest because we expect the emphasis to be on the current trend in relative performance and the outlook for price rises. We forecast Coles Supermarket comparable sales growth of 3.0% and Woolworths Food at 4.3% for 3Q26e. The growth gap in Woolworths favour is narrowing with an elimination of the gap in 4Q26e in our view. We expect limited detail on price rises because negotiations are ongoing with most suppliers. While not likely to be a feature discussed by Woolworths, its range rationalisation program called Customer Offer Reset is ramping up and will be topical throughout 2026. It could provide $100-$210 million in lower cost of goods on our estimates but will alienate some suppliers and therefore may have adverse effects on sales on a 2-3 year horizon.