Woolworths enjoyed "solid" H1 profits

Woolworths enjoyed "solid" H1 profits

Woolworths Ltd, Australia's largest retailer, said today (28 February) its core business had made gains in basket size and traffic in the first half of its financial year through a focus on prices and its product range.

The grocer, facing stiff competition from arch-rival Coles and with Aldi expanding in Australia, said its Australian food and liquor had "increased market share, customer numbers, basket size, items sold and sales per square metre" in the 27 weeks to 5 January.

Sales from food and liquor were up 4.8% at A$21.48bn (US$19.42bn). Comparable-store sales increased 3%, with a 3.4% rise in the second quarter. EBIT climbed 6.8% to A$1.69bn.

"We have delivered 6.8% EBIT growth in our Australian food and liquor business, consistent with our priority to extend our leadership in food and liquor," which has been achieved in a highly competitive marketplace," CEO Grant O'Brien said.

"We have continued our leadership in price and range, delivering more than $400 million in savings to customers predominantly through our More Savings Every Day programme."
The retailer said it "further improved the quality of our fresh offer, with enhancements to our supply chain". Its share of fresh sales was "growing 
faster than grocery", it claimed.
Woolworths group net profit after tax was up 14.5% at A$1.32bn. Net profit after tax from continuing operations before significant items was up 6%.
Group EBIT rose 11.3% to A$2.05bn. From continuing operations before significant items, EBIT was up 5.9%.
Sales increased 3.8% to A$31.8bn. From continuing operations, sales climbed 6%.
Woolworths upped the lower end of its forecast range for annual net profit. It estimates earnings will grow 5-7%, up from 4-7%, "subject to no significant deterioration in trading conditions".
Click here for the full statement.