November 27, 2022

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Awesome Business

Woolworths flags higher profit as Covid disruption eases

2 min read

South African fashion and food retailer Woolworths expects half-year earnings to rise more than 20% year-on-year as customers return to its stores, particularly in Australia, following prolonged pandemic lockdowns.

In a Sens announcement on Wednesday Woolworths said headline earnings per share, the main profit measure in South Africa, was expected to rise by more than 33.6 cents in the six months ended Dec. 25, from last year’s 168.2 cents.

Its shares were up 4.49% at 09:30.

The group’s turnover and concession sales for the 20 weeks ended Nov. 13 increased by 23.3% on the same period last year, as all its businesses grew sales.

In South Africa, its fashion, beauty and home businesses saw turnover and concession sales up 10.8%, thanks to full priced sales rising 15.2% and clearance sales down over 20%.

The food business grew turnover and concession sales by 7.3%, despite disruption from rolling power cuts.

The power cuts have “had a pronounced impact on our predominantly fresh categories across the business in terms of foregone sales, increased waste, and significant increases in diesel costs required to support trade during the extended power outages,” the retailer said.

In Australia and New Zealand, upmarket department store chain David Jones and fashion group Country Road delivered sales above pre-Covid levels as shoppers returned to stores after the easing of lockdown restrictions.

David Jones’ turnover and concession sales increased by 55.3%, while sales at Country Road Group grew by 36.2% thanks to launch of new ranges, which resulted in a higher proportion of full-priced sales.

With a substantial increase in sales at stores, online sales declined 13.7%. They now contribute 10.1% to the group’s total turnover and concession sales.

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