Endeavour Group’s 1H26 result release revealed ongoing weakness in Retail liquor sales and further gross margin pressure for 2H26e. Gross margin investment that commenced in September 2025 needs to flow through and should start to boost sales late in FY26e as marketing is ramped up. However, EBIT recovery will only begin in FY27e. The Hotel segment is seeing good momentum from site renewals and more will be done over the next year. However, it is grappling with higher cost growth.

Endeavour Group provided a trading update that revealed gross margin pressure on its Retail segment earnings for 1H26. The release also provided the first indications about new CEO Jayne Hrdlicka’s likely strategic direction. Ms Hrdlicka will clearly focus on price leadership and driving more sales through its stores. There is also scope to cut overheads and unwind the arrangements with Woolworths over time. We have lowered our EPS by 5% in FY26e and 1% in FY27e. We retain a Buy rating on Endeavour and expect the shares to re-rate once there is clarity from the refreshed strategy in May or June 2026.

Endeavour Group reported 1Q26 sales down 0.3%.  The sales dynamic remains broadly consistent with declines in Retail liquor volumes, but growth in Hotel sales. Endeavour’s commentary suggests gross margin risks are building as it invests in sharper pricing in order to improve sales trends in its retail stores. We expect EBIT to drop by 5% in Retail in FY26e, despite cost savings. The Hotel business should have a better financial year given sales growth, but costs are elevated.

Endeavour Group reported a weak FY25 result with EBIT down 12%. There were mixed fortunes with Retail earnings down and Hotels up.  Recent sales trends suggest a similar dynamic in FY26e. However, we see more cost savings and less headwinds from its One Endeavour restructuring costs. We make EPS downgrades of 5% in both FY26e and FY27e given lower Retail sales and some gross margin pressure. Endeavour’s balance sheet has high gearing. When combined with its management changeover in January 2026, the risks are growing that an equity raising is used to improve its balance sheet and provide the capital to turnaround the business.

Endeavour Group reported 3Q25 sales down 1.7%. The Retail division shrank further, while Hotels had a good quarter. The good news for the company and shareholders is the decline in retail sales should now be over. We forecast Retail comp growth of 2.1% for 4Q25e and 3.0% for FY26e. Hotels should see stronger growth, but investors should factor in an earnings dip associated with cashless gaming in Victoria from the end of 2025.

Endeavour reported 1H25 EBIT down 10% with a poor result in the Retail segment the primary driver. Higher transition costs to its new systems, distribution centre strikes and weak liquor industry sales all contributed to the challenging half. However, these issues are transitory. We expect another soft result in 2H25e given One Endeavour costs and wage inflation. However, we can see an inflection point emerging. Earnings should recover as industry-wide sales improve and cost savings flow through.

Endeavour Group’s 1Q25 result showed weaker retail sales trends and indications that gross margins are coming under pressure. The company said that Retail segment EBIT margins will fall by 50-100bp in 1H25e. We expect weak sales trends to persist a little longer, but the problem isn’t structural. The company has increased discounting to improve sales, which has hurt margins, but is yet to help sales.

Endeavour Group reported FY24 EBIT up 1.8% on a 52-week basis and EPS dropped 4.3% given higher finance costs. We expect a flat EPS of 28.6 cents for FY25e with subdued 1H25e sales growth and higher finance costs largely offsetting better gross margins and cost savings.  Endeavour’s underlying sales momentum shows market share gains and cost savings are likely to continue to build in FY26e.

Endeavour Group reported normalised sales growth of 1.0% for 3Q24. The retailer’s challenge is a tough industry backdrop. We expect soft sales trends to continue as the liquor retail industry undergoes a normalisation of volume and pubs experience some trading down behaviour. Even so, sales trends should improve slightly in 4Q24e and FY25e for Endeavour.

Endeavour Group reported 1H24 sales up 2.5% and EBIT up 2.6%.  The company had an increase in gross profit margins and some cost savings to help offset higher operating cost growth. Weak sales trends in liquor are likely to persist throughout 2024 in our view as the industry resets volumes back towards more normal levels post the COVID-19 boom. While higher gross margins can be a red flag, Endeavour is holding market share and the cost savings embedded in 1H24 give us confidence in second half earnings.