Leah Weckert will become the first woman to run Coles in its 109-year history when she takes over from retiring chief executive Steven Cain on 1 May, as the supermarket chain emerges from a period marked by pandemic supply disruptions and high food costs.
Weckert, who will be paid an annual salary of $2m plus a range of incentives, has held a series of high-level roles at Coles since 2011, including chief financial officer. The supermarket chain is one of Australia’s biggest companies, ranked in the top 20 on the stock exchange.
Weckert is taking over at a time of inflation-fuelled high prices for supermarket goods, although there are early signs that food costs may come down.
“The good news is that supplier cost inflation is starting to ease in the third quarter, particularly in produce,” Cain said on Tuesday.
“Many of our suppliers are however still facing increasing cost pressures and shortages of pallets, raw materials and labour.”
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Cain is retiring from the chief executive role after helping oversee the demerger of Coles from Wesfarmers in 2018, as well as leading the business through the pandemic years which included lockdowns, panic buying and supply disruptions.
On Tuesday, Coles posted an 11.4% increase in net profit to $616m for the six months to December, compared with the corresponding period in 2021, backed by strong sales at its supermarkets.
It has been one of the most reliable stocks of the pandemic years, alongside rival Woolworths, given resilient demand from shoppers. Over the past three years, Coles has recorded sales growth of 13.6% for its supermarkets and 15.4% for its liquor business.
UBS noted that the results were better than expected, backed by strong supermarket sales and increased margins, which led to a jump in the Coles share price in early trading on Tuesday back towards its record high.
Rising household costs, including high rents and mortgage rates along with inflation-fuelled electricity and food costs, are affecting buying habits, with the retail giant recording a 12% spike in sales of its cheaper home brand products.
The company said on Tuesday it would provide fully recyclable, reusable or compostable packaging for its Coles branded products by 2025.
Coles and Woolworths were recently ordered to dump more than 5,200 tonnes of soft plastic they were storing in warehouses into landfill over safety concerns. The build-up was caused by the suspension of botched recycling initiative REDcycle.
Shareholders will share some of the spoils of the strong financial result with a 9.1% lift in the interim dividend to 36 cents.
• This article was amended on 21 February 2023. An earlier version said that Coles posted an 11.4% increase in net profit for the six months to December, compared with the corresponding period in 2001. This period should have been 2021.
