An Increasingly Challenging Year Ahead For Metcash

Australian mass grocery wholesaler Metcash has reported strong results for its fiscal year ending April 2011, suggesting that it has coped well with the impact of rising commodity costs, deflationary pressures on the back of the strong Australian dollar and the increasingly difficult domestic demand conditions. We expect deflationary pressures in retail goods to somewhat moderate through the coming quarters. However, we remain wary of the increasingly challenging demand picture, which could dampen Metcash's revenue growth.

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