Coles Profit 2026 Rises 1% After $235 Million Provision

Coles Group released its full-year financial results on Monday, reporting a 2.8% increase in group sales revenue to $45.7 billion, according to Nine.com.au. However, Coles profit 2026 growth was limited after the retailer set aside approximately $235 million in provisions following a Federal Court decision on historical staff underpayments.

Net profit rose 1% to $1.09 billion, reflecting the impact of the Coles $235 million underpayment provision. The supermarket division achieved 3.7% growth in sales to $39.8 billion, driven largely by online grocery sales, with home delivery and click-and-collect sales jumping more than 26% to $5.6 billion. Liquor sales dropped 3.3% as shoppers cut back on alcohol.

Coles increased its full-year dividend to 78 cents per share, up 13% year-on-year, as part of its Coles annual results 2026 announcement.

The Coles worker underpayment scandal stems from a landmark Federal Court of Australia ruling handed down on September 5, 2025, which struck down a common retail industry practice regarding salaried store managers working 50- to 60-plus hours a week without overtime rates or penalty loadings. The cases involving Coles and Woolworths covered nearly 30,000 salaried employees and involved potential underpayments of up to $1 billion combined over several years, due to systemic payroll failures.

The supermarkets had averaged, or "pooled out," employee pay over long periods, with Coles and Woolworths arguing that store managers' fixed annual salaries were intended to cover all hours worked. The court ruled that employers cannot pool payments across months and that an employee's minimum entitlements must be met in full for a single pay period.

Coles said it had already paid approximately $31 million in remediation to affected salaried managers prior to the judgment. The legal action against Coles centred on approximately 7,800 to 8,700 salaried managers, while the case against Woolworths spanned more than 19,000 employees, with Woolworths reportedly setting aside a pre-tax liability of up to $750 million.

In other Australian business news, BlueScope Steel reported a sharp rise in profit ahead of a decision on the Whyalla Steelworks sale — BlueScope Steel Profit Surges as Whyalla Decision Nears.

Further information on Coles Group's results is available via Coles Group.