Advertise with

 Lower inflation helped the retailer sell more food, but its clothing division had a bad winter.
Lower inflation helped the retailer sell more food, but its clothing division had a bad winter.

Woolworths to return to profit


By Robert Laing - Nov 15th 2018, 14:16

Woolworths will return to profit in the first half of its 2019 financial year following the loss caused by its R7bn impairment of Australian department store chain David Jones in the matching period.


The retailer said in a sales update for the 20 weeks to November 11 that it expected its interim earnings per share (EPS) to recover from the 505.9c loss it reported for the first half of its 2018 financial year.

Woolworths said in that it would issue a trading statement for the 26 weeks to December 23, giving more precise guidance on its interim earnings once it obtains reasonable certainty.

The group’s overall sales in the first 20 weeks of its 2019 financial year grew 2.7% from the matching period, a slight improvement on the 2.6% growth it reported in its sales update a year ago.

Measured in “constant currency” — keeping the contributions from Australian subsidiaries David Jones and Country Road in Australian dollars rather than converting to rand — sales grew 3.6%.

David Jones grew sales by 2.9% after suffering a 5.3% sales decline in the first 20 weeks of the previous financial year. The sales update did not make it clear if this was measured in rand or Australian dollars.

Country Road grew sales 3.4%, a slowdown from the 8.3% reported in the sales update Woolworths issued in November 2017.

In its South African operations, Woolworths’ food division grew sales 7.2% — a slowdown from 9.3% a year ago — while its “fashion, beauty and home” division suffered a 3.3% decline in sales after managing 0.7% growth in the first 20 weeks of the previous financial year.

“While sales for the first quarter ended September 23 were affected by a significantly smaller winter sale, regular sales in October, particularly in womenswear, have shown a positive trend,” the sales update said.

Taking food inflation into account, which slowed to 1% from 4.5% in the matching period, Woolworths’ food division beat the previous year.

The trading statement said this was thanks to “volume growth driven by low inflation and higher levels of promotion”.
Business Live 

Read more about: woolworths | sales | retailer | retail | david jones

Related News

Pick n Pay introduces blood oranges to its fresh produce offering
22/03/2019 - 10:19
Fruit lovers no longer have to travel to Europe to taste the goodness of blood oranges. Pick n Pay has added rare blood oranges to its fresh produce offering making it the first retailer to offer this unique fruit to customers.

Instagram adds shopping feature for US users
22/03/2019 - 09:34
Facebook’s Instagram is trialling a feature that lets US users shop from the photo-sharing app by using a “checkout” option on items tagged for sale, the company said.

Retail sales recover in January after dismal December figures
22/03/2019 - 09:23
Retail spending showed signs of recovery in January, growing 1.2% on an annualised basis, slightly faster than analysts had expected.

Tips for small business owners to survive load-shedding
20/03/2019 - 09:36
With small businesses already dealing with hikes in VAT and petrol, coupled with decreased consumer spending, load-shedding is a bridge too far, particularly for restaurateurs.

Asos sales up 13% as UK market outperforms
20/03/2019 - 09:25
Asos has reported a rise in its quarterly sales, as growth at home in the UK continues to outperform its foreign markets.