Food momentum propels Woolworths successful Q3
Brad Banducci, CEO of Woolworths
Food sales continue to help turnaround the Woolworths Group, which announced its third quarter results for the 2017 financial year this week.
Woolworths reported strong sales momentum across the quarter, with Australian food sales up 5.1 per cent on the prior corresponding period in 2016.
Chief Executive Officer of the Woolworths Group, Brad Banducci, described the food sales result as a highlight of the quarter.
“However, the second half of the 2017 financial year will reflect the financial impact of higher investment in key areas, cost price increases (particularly in meat and produce) and our response to ongoing competition and promotional intensity,” Banducci signalled.
Despite the success in food, the Woolworths Group is still struggling with its Big W department chain, which is likely to lose AUD$115 – $135 million before interest and tax in the second half of the 2017 financial year.
Banducci attributed the loss to investment in turning the business around.
“Big W is a work in progress and its turnaround will be a multi-year journey,” he said.
Petrol sales benefit from average fuel selling price increase
Petrol sales for the quarter increased by 14 per cent on the prior year. Petrol volumes declined by (2.1) per cent on a comparable basis. Easter adjusted comparable sales increased by 11.9 per cent and Easter adjusted comparable volumed dropped by (2.5 per cent).
Woolworths said its petrol sales benefitted from an increase in the average fuel selling price compared to the prior year.
Good Easter trading for Dan Murphy and BWS
Woolworths’ liquor business increased sales increased by 2.3 per cent to AUD $1.9 billion compared to the prior year, with comparable sales increasing by 0.8 per cent. Easter adjusted total sales increased by 3.9 per cent with Easter adjusted comparable sales increasing by 2.2 per cent.
Woolworths said despite subdued market growth in the quarter, its BWS and Dan Murphy stores delivered positive Easter adjusted comparable growth in the quarter.
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