Retailer Woolworths (Woolies) yesterday said its turnover and concession sales for the 52 weeks ended June 26 increased by a mere 1.4 percent - weak numbers compared to its competitors, who are trying to eat its lunch.
This was reflected in its share price, which saw the counter up a marginal 0.11 percent to R54.65 in mid-afternoon trade.
Rival Pick n Pay yesterday said it grew sales by 10.7 percent in the 18 weeks to July 3, while Shoprite said its total merchandise sales increased by 9.6 percent in the 52 weeks to July 3.
Woolies was once again knocked by the sales of its Australian department store group David Jones, which declined by 2.6 percent for the full year, but grew by 4.3 percent in the second half, after the easing of lockdown restrictions.
Its other Australian business, Country Road group’s sales grew by 9 percent due to the strong performance of the Country Road, Trenery and Politix brands, following the successful launch of new ranges and the ongoing focus on brand and product positioning.
The group said trade in Australia and New Zealand in the first half of the year was significantly impacted by government-enforced restrictions across the region, which required the closure of stores representing more than 70 percent of its brick-and-mortar sales base for an extended period.
However, the fashion and food retailer said it saw an improved second half of the year as lockdown restrictions eased, especially in Australia and New Zealand.
Woolies said: “Notwithstanding the impact of rising inflation and interest rates, strong consumer demand and our focus on trade resulted in a better-than-expected rebound in sales in the second half of the year.
“Group turnover and concession sales grew by 4.9 percent and by 5.6 percent in constant currency terms, respectively, as lockdown restrictions eased and our focus on trade and executing against our strategic priorities delivered positive results.
“This was despite the volatile global backdrop, supply chain disruptions exacerbated by the Russian invasion of Ukraine, the impact of rising inflation and interest rates, and severe load shedding in South Africa,” it said.
Its South African Fashion Beauty and Home (FBH) business grew by 5.4 percent, supported by new winter ranges and market share gains. It said the rest of Africa also had a stronger performance.
Woolworths Food grew turnover, and concession sales increased by 4.6 percent, with trading momentum improving throughout the period as Covid-19 base effects eased.
“Woolworths Financial Services book reflects a year-on-year increase of 6.8 percent, driven by the recovery in post-Covid spend. The impairment improved to 4.7 percent, compared to 5.3 percent in the prior year, reflecting continued strength of the book,” the group said.
Online sales increased by 28.7 percent and contributed 22.8 percent to total sales over the full-year.
Woolies will release its annual results by August 31.
BUSINESS REPORT