2015Annual Report

2015 Annual Report

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ContentsAbout us ........................................................................................................................................................................................... 2

Welcome .......................................................................................................................................................................................... 3

Our strategy and values ............................................................................................................................................................4

2014/15 year at a glance ...........................................................................................................................................................5

Building better supplier partnerships .................................................................................................................................6

Backing Aussie producers ........................................................................................................................................................8

Creating trusted value .............................................................................................................................................................10

Delivering a better store network ....................................................................................................................................... 12

Extending into new channels & services ......................................................................................................................... 14

Building great careers .............................................................................................................................................................. 16

Accelerating growth at Coles Express ............................................................................................................................... 18

Transforming Liquor ................................................................................................................................................................. 19

Sourcing responsibly ............................................................................................................................................................... 20

Supporting our communities ...............................................................................................................................................22

Reducing our impact ............................................................................................................................................................... 26

Celebrating our longest-serving team members ........................................................................................................ 28

For feedback about our report or to ask a question, contact:

Coles Corporate Affairs 800 Toorak Road Hawthorn East VIC 3123 Ph: 1800 061 562 Email: Coles.Customer.Care@coles.com.au

Unless otherwise stated, the financial data in this report has been compiled as at 30 June 2015. Coles Supermarkets Australia Pty Ltd and its related companies (including their directors, officers, employees and agents) (Coles) make no warranty about the accuracy or completeness of this information. Coles will not accept any liability for any loss resulting from your use of this report, including any investment decisions you may make on the basis of its content. You should obtain professional advice before proceeding with any investment.

© Coles Supermarkets Australia Pty Ltd 2015. You may not reproduce any section of this report without the prior written consent of Coles Supermarkets Australia Pty Ltd.

2015 Annual Report

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Message from the Managing DirectorOur 2015 Annual Report showcases some of the great work our 101,008 team members have done over the past year across Australia.

I am proud of what we have achieved. We continue to lower prices for our customers while increasing our customer service levels and providing a real focus on the freshness of our produce. The feedback from our customers is very clear - these are the things that really matter to them.

We launched the Coles Nurture Fund and will provide $50 million in grants and interest-free loans to small Australian businesses seeking to innovate and bring locally grown produce to customers around Australia. Together with our team members and customers, we have contributed $43.7 million to charities, community programs and disaster relief.

In 2016 our focus remains the same. We will not rest until we achieve our goal of becoming Australia’s best food retailer. That means we will deliver great value, trusted quality and fresh produce, supported by passionate team members - every time our customers walk into Coles.

I am excited about what we can deliver in 2016 and it’s because of the passion and determination of our team members that we will continue to make a difference for our customers, suppliers and communities.

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John Durkan Managing Director, Coles

Welcome About us

We have more than 101,000 team members and operate 2,386 retail outlets nationally including 776 supermarkets, 858 liquor stores, 90 hotels and 662 convenience outlets located from as far south as Blackmans Bay in Tasmania to as far north as Casuarina in the Northern Territory.

Our workforce of 101,008 team members

WA

11,714

NT

819

SA

7,020

QLD

19,927

NSW

28,970

VIC

29,439

TAS

1,960

ACT

1,159

Financial Services

Coles provides fresh food, groceries, general merchandise, liquor, fuel and financial services to more than 20 million customers each week through its store network and online platform.

2015 Annual Report

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We strive to offer greater value by lowering the price of the weekly shopping basket, improving quality through fresher produce and delivering an easier, better shopping experience for our customers.

Our values underpin our strategy and the way we operate our business – from the decisions we make, to building deeper and longer-term relationships with our suppliers and business partners.

Transform

Focus on

Simplicity

Careers

Deliver a better Store network VALUE

Create trusted

Boldly extend into new

Channels& Services

Our strategy and values

2014/15 year at a glance

Total Profit+6.6%

Food and

Liquor Sales Growth +5.3%

Raised and contributed

to charities community programs and disaster relief

$43.7 million

Focus on Freshness

Boldly extending into new channels and services

170,000+ hours invested in team member

craft skills and in-store service

Better supplier partnerships

Delivering trusted value

Delivering a better store network

by Coles Brand products163 awards

won Lowering prices for six years and counting

$38 billion

Total Revenue

Coles Nurture Fund to support small business innovation

$50 million

2,000 products

More than at trusted ‘Every Day’

prices

Coles Online sites with Click & Collect

120+

insurance and credit card customers

800,000

57 newliquor stores & hotels

25new supermarkets

5.5 million active

households using

22new sites

We have fundamentally changed the way we source food for our customers by fostering longer-term and deeper relationships with our suppliers.

Building better supplier partnerships

Coles Supplier AwardsIn September 2015, we had over 1,500 guests in attendance at our inaugural Supplier Awards Gala Dinner.

This night was an opportunity to celebrate the outstanding contribution that suppliers have made to Coles in 2015.

The Awards consisted of eight categories and recognised excellence across all areas of our business.

The winners included:• Best In-Store Execution: Manbulloo Mangoes• Product Innovation and Quality: Flavour Makers • Best Product Launch: Tiger Coffee• Community Champion: Simplot • Outstanding Service Award: NCR• Outstanding Service Award: Littore Family Wines• Rising Star: Australian Fresh Leaf Herbs • Supply Chain Excellence: Mondelez International • Supply Chain Excellence: Parmalat • Sustainable and Ethical Excellence: Tassal

Growing togetherIn December 2014, we announced a 10-year partnership with Sundrop Tomatoes in South Australia for the supply of sustainable truss tomatoes. From 2016, this contract will ensure year-round supply for customers, create more than 270 construction and full-time jobs in regional Australia and support investment in highly innovative technology, including a 20-hectare greenhouse which will grow tomatoes using solar power and desalinated sea water.

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Sundrop Tomatoes

2015 Annual Report

Tallangatta cattle producers the Barton family and Coles’ Steve Rennie

We are transforming our supplier partnerships by developing deeper and longer-term relationships to give suppliers greater certainty to invest in their businesses and provide more opportunities to collaborate. We believe we are successful in the long term when our suppliers are successful in the long term.

Over the past year, we have taken many steps to build deeper and longer-term relationships with suppliers. We established a new Supplier Charter, which formally commits us to deal in good faith with our suppliers. It provides a strong, independent and confidential dispute resolution

process underpinned by the appointment of former Victorian Premier Jeff Kennett as an independent arbiter.

We have worked constructively for two years on the development of the Food and Grocery Code, and in June 2015 confirmed we would become a signatory following its ratification by Federal Parliament.

We are also improving our engagement through regular supplier forums, and providing more certainty through simplified terms and structured range reviews.

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Australia First at ColesWe take great pride in our Australia First sourcing policy, which aims to support Australian farmers and manufacturers. Today, 96 per cent of fresh fruit and vegetables sourced for Coles are Australian grown, along with 100 per cent of fresh milk and 100 per cent of fresh meat from the meat department.

In March 2015, we signed a two-year contract with Bundaberg Sugar to supply 20,000 tonnes of sugar a year and guarantee customers 100 per cent Australian-grown sugar across the whole Coles brand range. Under the contract, Bundaberg Sugar will supply Coles with white, brown, icing, caster and raw sugar which is grown, milled, refined and packed in Queensland.

The contract will provide certainty and security to 247 local growers and allows Bundaberg Sugar to invest around $2.5 million in new machinery at its packaging plant.

Backing Aussie producers

Working with Aussie farmers, producers and growers is at the heart of what we do – our customers tell us they want more local food on their shelves and we aim to deliver with the very best Australian products.

In April 2015, we announced the launch of the Coles Nurture Fund to help small Australian businesses looking to take the next step in creating more productive and innovative ways of working.

Through the Nurture Fund, Coles will allocate $50 million over five years in grants and interest-free loans to fund the development of new market-leading products, technologies and processes.

After receiving close to 100 first-round applications from across the country, we were delighted to announce the first recipients of Coles’ Nurture Fund in September 2015. More than $2.5 million in grants and interest-free loans were awarded to six farmers and producers seeking to innovate and bring more locally-grown produce to customers around Australia.

Westerway Raspberry Farm, Tasmania – Using new freezing technology, the Clark family of Westerway will become the first in Australia to supply locally-grown frozen raspberries all year round.

Moonrocks, Queensland – Fifth generation farmers Andrew and David Moon can now dramatically increase their capacity to supply locally-grown garlic thanks to machinery funded by a Coles grant.

Yarranabee Pty Ltd, Western Australia – With the assistance of a Nurture Fund grant, Ashley and Jo Wiese from Yarranabee can now build the first commercial quinoa processing plant in mainland Australia, allowing them to grow, process and sell quinoa on a large scale in Australia.

Butler Market Gardens, Victoria – Sixth generation vegetable grower Rick Butler will use his interest-free Nurture Fund loan to purchase new automatic washing and drying technology and a chemical-free post-harvest sanitisation unit, which will help ensure the highest quality produce for customers.

Berry Yummy, Queensland – Berry Yummy will be the first Australian strawberry farm to implement cutting-edge heat-seal technology to reduce packaging and food waste, ultimately providing fresher and better quality strawberries to customers.

Harvey Citrus Pty Ltd, Western Australia – Harvey Citrus will use the funds from a Coles grant to plant more than 9,000 new trees to ensure locally-grown limes and mandarins are available to customers for more months of the year.

The Coles Nurture Fund is open to businesses with less than $25 million in annual revenue and 50 or fewer full-time employees. More information is available at www.coles.com.au/nurturefund

“ Australia produces some of the highest quality food in the world and farmers, producers and manufacturers in Australia are continually demonstrating how innovative they are on their farms and in the factories. The Coles Nurture Fund will help drive innovation and growth for small businesses so they can take up more opportunities in Australia and on the world stage. ”

Ashley Wiese from Yarranabee

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Supporting innovative small business

Nurture Fund

2015 Annual Report

Coles Fresh Advisor and Ambassador Curtis Stone with

Fresh Select CEO John Said

Award-winning productsDuring the year, Coles Brand products received 163 industry accolades including 20 awards and seven gold medals at the prestigious 2015 Royal Sydney Cheese & Dairy Produce Show.

Our top performer of the year – Coles Brand ice cream – established itself as the market leader in the premium ice cream category, taking out a total of 35 awards at the Product of the Year Awards, the Dairy Industry Association of Australia (DIAA) Competition and Royal Agriculture Society of NSW Sydney Royal Show.

Health star ratingsDeveloped by the Federal Health Department with input from industry leaders and consumer and public health groups, the Health Star Rating system is a voluntary front-of-pack labelling system that calculates the product’s nutritional content and scores the overall nutritional value of a product out of five stars.

Health Star front-of-pack nutrition labelling was introduced at Coles in 2014 and approximately 700 products across the store now feature this labelling, including more than 400 Coles Brand products.

The Health Star Rating system helps take the guesswork out of shopping and makes it even easier for customers to make informed choices.

At Coles, we understand that value is more important than ever as our customers look to us to help them save on their shop.

So whether it’s fresh food, pantry staples or quality apparel, our customers can depend on Coles to deliver trusted value – every day of the year.

Creating trusted value

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2015 Annual Report

Queensland sweet potato grower Brendan Boon

In 2015, we launched the Coles Fresh campaign – a fundamental change in the way we think, talk and deliver fresh food to our customers.

Coles Fresh covers every aspect of our business from paddock to plate and showcases the great quality and

Every Day ValueWe are constantly looking at new ways to invest more into keeping the cost of living down and lowering the cost of shopping for Australians.

Since 2011, more than 2,000 products have been reduced to ‘Every Day’ prices. Focusing on the products our customers buy most, we are making a real difference to families on a budget. Compared to six years ago, Australian households can save an average of $640 a year by shopping at Coles.

In February 2015, we dropped the prices across the bread range in stores, including Abbott’s, Tip Top and Wonder White.

The average Australian household buys two loaves of bread per week, making these Every Day price reductions one of the most effective ways to deliver savings to our customers. Customers will no longer have to wait for their favourite bread to go on special with these value buys available every day of the year.

fresh food available in our stores. It’s about delivering real value customers can trust through greater quality, fresher products at more affordable prices.

We worked closely with our farmers and growers across Australia to look at the way our products are grown, harvested and prepared. Together with Curtis Stone – our Fresh Advisor and Ambassador – our teams have rejuvenated our offer and developed new products specifically for the Australian market. And to really bring the fresh experience to life for our customers, we have invested in over 170,000 hours of fresh craft skills training for our team members across the country.

Delivering a better store networkWe operate more than 2,300 stores across Australia. As we grow and adapt our network to suit the needs of our customers and local communities, we are always looking to improve our stores and ensure a consistent customer experience.

Coles LiquorLiquorland Coburg North features a new layout providing simpler navigation, a tailored range and a fresh look and feel. Co-located at Coburg North Village, the new Liquorland also showcases bold value messaging and matched food and wine offers to complement the Coles catalogue.

Coles ExpressLocated on a major thoroughfare, Moonee Ponds was one of seven new sites to be opened in Victoria during the financial year. The site features a larger convenience store with an improved range across all categories and a food-to-go offer.

new stores opened56

new stores opened22

supermarkets opened25

Coles SupermarketsIn August 2015, a new state-of-the-art Coles supermarket was unveiled in Coburg North, bringing to life the latest in supermarket features.

The 4,000 square metre supermarket features an extensive fresh offer, including an open market-style fresh produce section and an in-store bakery, butcher and deli.

The Coburg North store is Coles’ first partly solar-powered supermarket in Victoria, with 399 solar panels installed on the roof to generate up to 100 kilowatts of power.

In the lead up to opening, Coburg North team members worked to support the local area beyond the checkout as part of Coles’ Helping Hands initiative.

Through this initiative, the team volunteered at Coburg North Primary School, Lake Park Kinder, Harmony Park and Coburg Primary School, helping to build cubby houses and plant trees.

Additional needs trolleysColes has introduced the additional needs trolley to over 400 supermarkets across Australia to help make the shopping experience more accessible for families.

The new trolley means parents or carers who have children with a disability can shop more easily by allowing them to place all their groceries in a trolley while also having their child seated safely.

Features include a weight allowance of up to 70 kilograms, a padded seat, harness and additional structural support.

Coles will provide the additional needs trolley to any store that requests one on behalf of a customer.

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2015 Annual Report

We are a team of locals serving locals and we are enjoying the opportunity to get to know the community and help out wherever we can. ”

Laura Minahan Store Manager, Coles Coburg North

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We’re not just about food and liquor – we’re a multichannel retailer, offering our customers a range of products and services to suit their needs.

Extending into new channels & services

flybuys is one of Australia’s largest shopping loyalty and rewards program, with more than 5.5 million Australian households active on the program.

In 2015, flybuys was judged Australia’s most popular rewards program according to independent research published by First Point Research and Consulting.

The flybuys program now includes more than 25 industry-leading program partners including new partners Adidas, Weight Watchers, OPSM and Fitbit.

In December 2014, flybuys launched eShops – an online gateway to some of the world’s favourite brands and online retailers, including eBay, with the benefit of flybuys points for every dollar spent through eShops, excluding delivery charges and taxes. As of October 2015, more than 175 online retailers are now trading through flybuys eShops.

Etihad Airways joins flybuysIn October 2015, flybuys and Etihad launched a partnership which enables flybuys members to turn everyday shopping into international flights.

flybuys members can collect flybuys points when booking Etihad Airways flights and enjoy exclusive access to airfare deals to more than 100 destinations worldwide. In a world first, flybuys members who link their Etihad Guest membership will also earn Etihad Guest tier miles when they spend at Coles and selected partners.

Coles Online is a critical part of our strategy to make shopping with Coles easy and convenient for our customers. It is a channel where our customers can have access to Coles’ great value, fresh offer and comprehensive range – at the time that is convenient for them and delivered to the location of their choice.

Over the past year, usage of our popular Click & Collect service has doubled in volume. Click & Collect is a key part of our Coles Online offer and enables customers to pick up their shopping from more than 120 locations around Australia.

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2015 Annual Report

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Coles Financial Services is focused on bringing everyday products such as insurance and credit cards to Australian families.

During the year, Coles Financial Services added to its growing product suite of simple and competitive products, which now includes car, home, life and landlord insurance as well as credit cards.

In May 2015, Coles Financial Services exercised a call option to acquire GE Australia’s share in the Coles credit card joint venture. Taking full control of the joint venture is expected to provide greater flexibility to deliver growth and better value to more than 880,000 customers.

In July 2015, Coles Financial Services launched the new Coles Low Rate MasterCard, which combines a competitively low interest rate on purchases with the ability for customers to earn flybuys points.

Financial Services

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Women in LeadershipEarlier this year, our Women in Leadership Steering Committee chaired by GM Liquor Operations Cathi Scarce, unveiled a commitment to increase the number of women in leadership positions across the business by 2020.

Additionally, eligibility for Coles’ paid parental leave was expanded in July 2015. Team members are now eligible for paid parental leave after 12 months’ employment, instead of the previous two-year requirement. This commitment builds on the work commenced last year to broaden flexible working arrangements to support working families.

AccessibilityWe launched our first Accessibility Action Plan with team members in 2015 and will soon lodge this with the Human Rights Commission. The plan demonstrates a commitment to improve the accessibility of our stores, sites and services. During the year, we also worked with the Australian Network on Disability to participate in the ‘Stepping Into Internship Program’ which provides paid work experience specifically designed for university students with a disability.

Nurturing talentIn 2015, Coles increased its intake of graduates tenfold – recruiting 300 graduates in a move that represents one of Australia’s largest graduate programs by an Australian-owned company.

The accelerated development program ensures graduates are placed into permanent roles which are exciting, challenging and rewarding, with real responsibility and accountability. The program has a specifically-designed curriculum and graduates are supported with ongoing training, coaching and a robust support network of leaders across the business, ensuring they are stretched and challenged throughout the program.

In addition to the Graduate Program, we have also introduced a new Vacation and Internship Program to give more opportunities to young Australians hoping to gain experience.

During the year, we maintained a strong focus on developing talent internally with more than 950 team members taking part in the Retail Leaders Program, our key training platform and pathway to a career store management.

Born and raised in Mackay, Cindy Yuen recently moved to Melbourne to launch her career in retail through the Coles Graduate Program.

Selected from thousands of applicants, Cindy is now working as a graduate in the Marketing team.

“I feel very challenged and supported in my role. I love the people I work with, and I like that there is a genuine concern internally for customers and their communities,” she said.

Bindi Templeton, who grew up in Brisbane, is working as a Merchandise graduate.

Like Cindy, she was attracted to the diversity of roles available to her at Coles, including areas outside her study.

“So far, I’ve really enjoyed learning about the overall Coles strategy and its commitment to providing value and quality for its customers.”

Building great careersA diverse and inclusive team which represents the community we serve enables us to provide the best customer experience. Through a range of innovative personal and career development programs, we support our people to be the best they can be.

DiversityWe aim to represent the communities in which we operate, embracing the richness of Australia’s diverse population. We know that bringing together diverse backgrounds and experiences helps us to get even better at serving our customers and creating new ideas for the future.

2015 Annual Report

Indigenous team membersMore than 900 Indigenous team members joined the Coles team this year, including 500 team members through our First Steps Indigenous employment program and direct recruitment. This brings our total Indigenous workforce to approximately 1,800.

Our newest graduates of the First Steps program

Kim Sully and Alison Verdoon job share the Store Manager position at Coles Mitcham

New Coles graduates Bindi Templeton and Cindy Yuen

Coles Managing Director John Durkan with a group of Coles graduates

STRAIGHT HEADING

Accelerating growth atColes Express is driving growth by expanding its store network and leveraging Every Day Value in its convenience offer.

Trusted valueValue has been a key part of the Coles Express strategy in 2015, with a strong focus on delivering savings to customers.

In a first for the Australian convenience market, Coles Express introduced trusted Every Day Value pricing to stores, complementing the Every Day Value and specials at Coles supermarkets. Refreshed ranges and products specific to the convenience market were also introduced including a new frozen range, lower priced food-to-go and the national rollout of 80 cent coffee.

The savings continued for customers in fuel, with price capped discounts in several metropolitan areas across the country over the 2014 Christmas and New Year period.

Express StepsIn 2014, Coles Express launched a range of DVDs called Think Healthy, Act Healthy to team members focusing on nutrition, movement and wellbeing. On top of this, a fitness challenge called ‘Express Steps’ was launched to encourage team members to make regular movement part of their everyday activity.

So far, 1,000 team members have purchased a Fitbit at a subsidised rate and 400 have joined the program. Within six months of launch, more than 332 million steps have been registered by Coles Express team members, equating to more than 230,000 kilometres.

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2015 Annual Report

Transforming LiquorOur Liquor transformation is underpinned by a customer-led strategy, focusing on optimising the store network and improving the customer offer.

Optimising and refreshing the Liquor network was a key focus in 2015 with the launch of the first-ever renewal program for Coles Liquor. Under this program, 165 Liquorland stores were refurbished to optimise space and showcase bolder value-focussed messaging.

The Liquor renewal program was complemented by investments in price reductions and a simpler,

more targeted range in all three retail brands – Liquorland, Vintage Cellars and First Choice. Customers responded with the Liquor business returning to positive transaction growth for the first time in five years.

Coles Liquor also reduced its lost-time injury frequency rate (LTIFR) by half, achieving its best result on record by putting health and safety in the spotlight across the network.

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Sourcing responsibly

Responsibly sourced seafoodAfter assessing hundreds of wild caught and farmed seafood products and four years of working closely with suppliers, WWF-Australia, the Marine Stewardship Council (MSC) and the Aquaculture Stewardship Council (ASC), Coles can now assure customers our Coles Brand seafood is responsibly sourced.

These responsible sourcing standards ensure Coles Brand fresh, frozen and canned seafood is traced from the time it leaves the fishery to when it is purchased, giving customers confidence and choice to help make a difference for the environment and contribute towards a more sustainable future.

To help make it easier for customers to choose responsibly-sourced seafood, Coles Brand seafood is either MSC certified, ASC certified or independently assessed to meet

robust sourcing requirements. As part of this, Coles is the first major Australian supermarket to introduce MSC and ASC labelled products in the Deli.

We believe responsibly sourced seafood means we know how and where our seafood is caught, ensuring fish populations and the impact on surrounding habitats and ecosystems are monitored to meet our robust sourcing standards.

We are delighted to have reached this milestone and will continue to review our program as the environment in which fisheries operate is complex and ever-changing. We are committed to this as we recognise well-managed and responsible fishing is essential for the future sustainability of our marine ecosystems.

Graze Grass-Fed BeefIn September 2014, we launched our Coles Brand Grass-Fed Beef Range, called Graze. Graze gives customers the assurance that they are buying premium 100 per cent pasture-fed beef produced by Australian farmers at great value. We developed ‘the Graze standard’ with industry bodies as well as some of our grass-fed producers. The standard governs on-farm practices and systems, animal traceability, feed and water requirements, animal welfare and handling practices and farm management. More than 115 beef producers are operating to this standard.

2015 Annual Report

ASC-C-00821 MSC-C-54768

BonSucro sugarAll of our Coles Brand Australian sugar range was relaunched with BonSucro environmental certification in June 2015. This was made possible as a result of partnering with to Bundaberg Sugar to supply Coles over two years with 40,000 tonnes of Australian grown and made white, brown, icing, caster and raw sugar.

We care about where our products come from, and we work with our suppliers and industry experts to adopt responsible practices for the wellbeing of people, animals and the environment.

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Supporting our communitiesEach year Coles supports national and local charities with fundraising, food donations and disaster relief. This year, our direct community contributions were $36.5 million with an additional $7.2 million raised by customers, team members and suppliers.

“ The commitment of the Coles team and customers across Australia is truly inspiring. They are helping Redkite achieve our vision to support all children and young people with cancer and their families who need us. Redkite is now supporting up to 50 per cent more families than in 2013 and in some service areas, the level of support we are delivering has doubled.

In just one year, Coles has funded more than 14,000 hours of counselling and practical help in hospitals across Australia and enabled Redkite to reach more families than ever before. Additionally, we’ve helped hundreds of young cancer patients and survivors build their futures through tailored education and career support, scholarships and grants.

Every six hours a family is told their child has cancer. Thanks to the Coles team and customers, we will help to ensure they are not alone and we will be there for as long as they need us.”

Since Coles’ partnership with national cancer charity Redkite began in 2013, we have raised more than $15 million for Redkite and Australian families affected by cancer.

Our team members have been passionately raising awareness and money for Redkite by organising fundraising activities including dress-up days, bike rides and bake sales.

Five cents from the sale of every loaf of specially-marked Coles Smart Buy and Coles Brand bread has also been donated to Redkite since 26 January 2013.

Redkite has been supporting children and young people with cancer and their families for 30 years, providing practical support for the whole family, from the moment of diagnosis, throughout treatment and when families return home to the community.

Coles has worked with SecondBite since 2011 to distribute surplus healthy, fresh food to community food programs supporting disadvantaged Australians.

Since our partnership began, more than 10 million kilograms of fresh food has been donated to SecondBite, providing 20 million nutritious meals to community food programs all over Australia, supporting low-income families, homeless people, refugees, and Aboriginals and Torres Strait Islanders.

In the last year alone, the amount of food rescued by SecondBite from Coles stores and Distribution Centres was more than 4.3 million kilograms, enough to provide 8.6 million healthy meals.

In July 2015, Coles supermarkets across the country put a spotlight on reducing food wastage and raised money for SecondBite by selling food storage labels to help customers make the most of their leftovers.

Through our partnership with SecondBite around Australia, every day approximately 570 Coles stores are donating fresh produce and bakery items to more than 1,200 community food programs in metropolitan, regional and rural areas to assist the estimated two million Australians who don’t have access to a safe, regular, and affordable food.

The SecondBite partnership is building stronger healthier families by reducing their food costs. Community groups can invest in other services to help people get back on their feet including education, job training, health programs, accommodation and financial support.

This innovative partnership is creating a significant social and environmental impact by reducing food waste, and increasing access to healthy food for thousands of disadvantaged Australian families.

Together, SecondBite and Coles are building healthier, stronger communities by improving the nutrition and long-term health of vulnerable children and families. ”

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2015 Annual Report

Jenni Seton Chief Executive Officer, Redkite

Elaine Montegriffo Chief Executive Officer, SecondBite

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The Coles team at the sod turning for Hummingbird

House in Brisbane

Coles has been an official partner of Cancer Council’s Daffodil Day since 1996 and has helped raise more than $21.9 million for cancer research, education and support services through the ever-popular Daffodil Day campaign.

In 2015, we celebrated our twentieth year partnering with Cancer Council’s Daffodil Day and together with Coles Express and our generous customers, we raised a total of $2.3 million – one of our highest ever fundraising results.

The funds raised will go towards Cancer Council support services in each State and Territory to provide vital assistance to newly-diagnosed patients and people living with cancer.

Bravery Trust (the trading name of the Australian Defence Force Assistance Trust) was established in 2012 to provide urgently needed financial support to current and former members of our Defence Force and their families who are suffering as a result of their service.

Coles has raised a total of $3.6 million to support Aussie diggers and their families since commencing our partnership with the Bravery Trust in April 2014.

Earlier this year, we supported the Bravery Trust with an Anzac Day fundraising campaign, raising more than $800,000 through customer fundraising and increasing awareness of the issues facing our service men and women. As part of this campaign, 12 cents from the sale of every pack of Coles Bakery Anzac Biscuits, Double Choc and Choc Chip Cookies was donated to the Bravery Trust. Sales of Coles Brand Spring Water since October 2014 have also contributed significantly to the Bravery Trust.

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In 2014, our supermarkets in Queensland joined forces with local customers to raise funds for Hummingbird House, Queensland’s only children’s hospice.

Based in Brisbane, Hummingbird House will provide vital palliative care and respite support in a ‘home away from home’ environment.

This year, Coles customers in Queensland helped raise more than $300,000 for Hummingbird House, building on more than $113,000 raised last September.

These much-needed funds will be used to help furnish family accommodation units, allowing families to stay together while their child receives respite or end-of-life care.

Set to open in early 2016, the state-of-the-art Hummingbird House will be a place where kids can be kids, and families can reconnect and create treasured memories.

Bravery Trust ambassador Daniel Keighran VC joins Coles

Donvale team members on their Anzac Day fundraising

Sustainable energyAlthough we grew our store network this year, our energy use remained steady compared with last year thanks to several new developments in sustainable energy, including LED lighting, solar power and the introduction of an energy centre.

We have retrofitted LED lights across 184 convenience stores and supermarkets to further lower energy use.

We have trialled the use of solar power, adding panels to our new store at Coburg North (VIC) which opened in August 2015, and to the roof of an older supermarket at Budgewoi (NSW) in 2014. The solar panels at Coburg North are expected to deliver a 10 per cent decrease in annual light and power expenses.

Other sustainable energy developments at Coles include the City FM Energy Centre, which provides 24-hour monitoring of our supermarkets so any anomalies are identified and immediately corrected by technicians. During the year, a total of 3,300 issues were resolved, helping to save 13 million kilowatt hours.

Coles Hallam achieves Green Star ratingIn June 2015, we achieved the first Green Star rating for a supermarket – Coles Hallam in south east Melbourne was awarded a 4-Star Green Star rating from the Green Building Council of Australia (GBCA). This is an outstanding achievement for Coles Hallam, which uses natural refrigerant, extra insulation and combined cooling for efficient temperature control.

Key features of the store include the use of high-performance heating, ventilation and air-conditioning systems, which save 50 per cent more fresh air compared to minimum standards. Impressively, the Hallam store also recorded a 70 per cent reduction in water consumption compared with traditional supermarkets.

Reducing our impactWe are committed to looking at the environmental impact we have on communities in which we operate and understanding how we can make a difference now and in the future.

During the year, our customers and team members helped recycle over 100 million units of soft plastic through the REDcycle program.

The world-class-recycling program was developed by Coles and RED Group in 2011. The program encourages customers to gather together all their empty bread, cereal and frozen food bags, plastic shopping bags and other flexible plastic packaging that can’t usually be recovered via kerbside collection, and take them to dedicated bins in one of 480 Coles stores nationally where the service is available.

“This is a significant environmental achievement. Thanks to the efforts of Coles’ customers, we have recovered a substantial amount of soft plastic that was destined for landfill and has led to Coles reaching this important milestone,” said RED Group Director of Development Elizabeth Kasell.

We have also introduced new labelling for Coles Brand products with soft plastic packaging to inform customers about recycling. The label will be introduced progressively for all products with packaging that can be recycled through the REDcycle program.

Local communities are also benefiting from the program with Victorian manufacturer Replas using melting technology to build furniture. To date, 139 benches and items of playground equipment have been produced from the recycled materials and given to schools and community groups across Australia.

More recently, Replas technology was used at Coles Coburg North to build a plastic trolley bay from 70,000 recycled plastic bags.

In-store recycling

Solar panels on the roof of Coles Budgewoi (NSW)

Students from Flinders Christian Community College give recently installed playground equipment a workout. Made from 100 million

units of recycled soft plastic by Seaford recycling company Replas, it is part of the Coles and RED Group REDcycle program.

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2015 Annual Report

Celebrating our longest-serving team members

2015 Annual Report

We recognise that our people are vital to our success and each year we celebrate team members who have dedicated many years of loyal service to Coles.

Meet the longest-serving store team members in each state and territory around Australia. Together they’ve notched up an incredible 366 years of service between them!

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Coles Wellington Store Manager Peter Grossman began working at Coles in 1973 and is celebrating 42 years of service in 2015.

Peter is a proud supporter of Camp Quality and together with the Coles team, he has helped raise more than $50,000 for the charity over the past decade.

Coles Northlakes Fresh Produce Manager Tony Nascivera has worked at Coles stores around Darwin and Adelaide for the past 42 years.

Tony began working when he was 16 and describes the Coles team as his ‘adopted family’. He has held many roles throughout his tenure but his greatest passion is fresh produce.

Graeme Beswick from Coles Prahran is the longest-serving team member in Victoria, celebrating 50 years with Coles this year. Graeme started at Coles in 1965 – a time when bread was just 20 cents a loaf!

Graeme considers himself a jack-of-all trades having worked in a number of departments across the store.

Coles Belconnen’s Michelle Lopilato is celebrating 43 years of service in 2015. Michelle started when she was just 15 years old. After seven years, she transferred to Coles Belconnen where she has worked for the past 36 years.

Michelle prides herself on customer service and says she is enjoying her role as much as ever.

Kerry Foster from Coles Orange is celebrating 46 years with Coles this year. Kerry credits her passion for Coles to the lifelong friends she’s made with both customers and her team.

Kerry volunteers in her spare time and together with her friends and team, she has helped raise more than $200,000 for the local hospital!

In March 2015, Coles Clifton Beach Duty Manager Kevin Wright celebrated 50 years of service. Over the past five decades, he has worked in more than 30 stores across Australia.

As a 17 year old, joining the business was a family affair with Kevin’s mother, brother and cousin all working for Coles at the time.

Ray Berryman has been working at Coles Albany since he joined the business more than 42 years ago. Ray began working at Coles in 1972, and four decades later, he continues to work part-time.

His daughter and son-in-law have both followed in his footsteps, working at different Coles stores in Western Australia.

Officer-in Charger at Coles Adelaide Diedre Bright began working at Coles when she was 15 years old and has since worked in 22 stores around South Australia over the past 48 years.

Diedre says she has seen many changes at Coles – a highlight was working in Edwardstown, the state’s first computerised store in 1987.

42 years

50 years

43 years

46 years

50 years

42 years

43 years

48 years

Peter Grossman, TAS

Graeme Beswick, VIC

Michelle Lopilato, ACT

Kerry Foster, NSW

Kevin Wright, QLD

Tony Nascivera, NT

Ray Berryman, WA

Diedre Bright, SA

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