Wesfarmers’ acquisition of Coles in 2007 is paying off for the company as it continues to drive growth for the business.

At the annual general meeting, managing director Richard Goyder said the company’s performance is in line with expectations for this financial year.

“Our retail businesses continue to achieve good transaction growth and provide better value for customers, while our insurance business has to date benefitted from improved underwriting performance and lower claims experience,” he said.

Goyder highlighted in financial terms both Coles EBIT and return on capital have nearly doubled since the acquisition.

For the first quarter both food and liquor’s comparative sales growth of 3.7 per cent and Coles Express’ comparative fuel volume growth of 0.4 per cent have outperformed their respective markets.

“We have been happy with the start to the financial year which Coles has made, with underlying volume growth in the food and liquor businesses continuing to be strong,” he said.

“Growth in these businesses has also continued into the second quarter of this year. We now have approximately two million more customers visiting our stores each week than we had in 2007, reflecting the continued improvements in quality, service and value.

“Coles team members are working hard in the lead up to Christmas to deliver Coles Christmas magic to Australian families. While Coles continues to experience price deflation through a combination of ongoing price investment and price deflation in fruit and vegetables, it is lower than that experienced in the first quarter of the year.

“It is important to note that the Coles turnaround represents the largest global retail turnaround in recent years, and we are pleased with performance to date which has met or exceeded our acquisition case assumptions in most areas. Coles is a very large and complex organisation and the turnaround has involved improvements to many aspects of the business.”

The company also made note of the pleasing performance of Bunnings and Target.