Woolworths Limited, Australia’s largest supermarket operator, has reported a 7.5% surge in full year sales to $49.6 billion.

Chief Executive Officer, Michael Luscombe, said their results highlighted the resilience of the Australian economy.

“Despite the global economic turmoil, 2009 has been a successful year with solid results across our business overall,” he said.  “Continued solid sales growth in food retailing and especially in discretionary areas like apparel, consumer electronics and homewares, highlights the underlying strength of the Australian economy in these times.”

Woolworths credited reinvestment in their businesses as a key to the strong figures, with Australian food and liquor and Big W again leading the way.

Australian Food and Liquor
Australian Food and Liquor sales for the year rose 9.6% to $32.8 billion, comfortably above the rate of inflation (4.1%). On a comparable store sales basis, the company saw sales rise 7.4% – slightly above last year’s sales growth of 6.3%, although inflation had risen from 2.9%.

Comparable sales for the fourth quarter were 7.9%.

“This is another solid performance demonstrating the degree to which customers in this current economic climate have embraced our key strategic initiatives such as price reinvestment, the 2010c store format, and our Everyday Rewards program,” Greg Foran, Director of Food, Liquor and Petrol, suggested.

The retailer opened 28 new Australian supermarkets during the year, ahead of their targeted range of 15 to 25. They now operate 802 supermarket outlets.

Mr Luscombe linked sales growth in their food division to a trend toward home dining.

“What we have seen in the last three-quarters to a year has been that generally there’s been a upsurge in cooking at home by the relative sales of food and food ingredients and cooking ingredients,” he reported.

Costco “will do well”

Mr Luscombe was complimentary to pending new entry to the Australian retail environment Costco, although he believes they won’t threaten the surging profit at his company.

“They are really good retailers and they will do well,” he told Bloomberg in an interview. “We think we measure up pretty well against what Costco has to offer.”

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