Australia’s largest food retailer Woolworths continues to impress investors bucking the doom and gloom forecasts of other retailers following the terrorist attacks in the US last month.

In the first eight weeks of 2001-2002 the supermarket revealed a sales increase of 8.7% compared with first quarter growth last year of 9.2%.

Chief executive Roger Corbett admitted that the day of the terrorist attack was “very tough” but sales have bounced back and he is confident of at least matching first quarter growth.

Woolworths continues to enjoy a share price rally as analysts expect it to achieve 15% growth this year including an extra $1bn sales from the acquisition of 67 Franklins stores following the departure of Hong Kong’s Dairy Farm International.

Woolworths may pick up more Franklins stores as wholesaler Metcash is thought to be having difficulty selling buyers for about 18 stores (of the 120 it is selling).

Credit Suisse First Boston has cut A$11m (US$5.5m) from its 2001-2002 net profit forecast although it still hopes for A$59.7m, up from A$37m last year.

By David Robertson, correspondent