Endeavour Group reported a modest lift in 3Q23 sales with improved sales in Retail still lagging the rate of inflation and the Hotel segment sales recovery driven by lower margin food and beverage sales. Endeavour should report earnings growth in FY23e, but growth may step down in FY24e as soft sales trends, weaker gaming sales and higher wage costs places pressure on profit margins.

Endeavour Group reported 3Q22 Easter-adjusted sales decline of 0.7% in its Retail liquor business and 2.5% growth in Hotels. The sales trends improved later in the quarter as the economy reopened further after a spike in Omicron cases in January 2022. The company also noted some disruptions and costs associated with floods in northern NSW and QLD.