Coles Group Ltd

COL: XASX (AUS)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	A$74.10	Tzck	Scgdxxc

Coles Divests Small Express Segment at a Discount, but Immaterial to Our Unchanged FVE of AUD 13.60

Johannes Faul

Sep 21, 2022

No-moat Coles announced the sale of its convenience business, Coles Express. The segment is a marginal contributor to group earnings, accounting for only 2% of group EBIT in fiscal 2022. While we had expected Express to recover from lower fuel volumes initially hit by lockdowns and later by rising fuel prices, the segment's importance to the group is low. We estimated the segment to account for a mere 6% of group operating earnings by fiscal 2024.

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