Deflation hits Metcash Ltd
GROCERY and liquor wholesaler Metcash Ltd has downgraded its full year earnings guidance because of continuing food and alcohol price deflation. Metcash brands include IGA ( Independent Grocers of Australia), Cellarbrations and Bottle-O, and has exposure to the hardware market through Mitre 10. The company yesterday said underlying earnings growth was expected to be between 3 per cent and 5 per cent. Chief executive Andrew Reitzer said deflation affecting the price of dry packaged groceries was 1.7 per cent and that deflation on fresh products about 11 per cent.