As Woolworths Group announced the resignation of CEO Brad Banducci, it also released its 1H24 financial results, recording a 4.4 per cent increase in group sales to $34.6 billion and a net loss after tax of $781 million.
Woolworths had flagged the loss at the end of January, due to a “very challenging” trading environment in New Zealand and Big W.
It reported $1.7 billion in goodwill write downs on the New Zealand Food business, with Banducci saying, “a value-focused customer, moderating price inflation and material wage inflation led to an EBIT decline of 42 per cent during the half to NZ$71 million.
“We are confident we are on the right path and have a strong customer plan to sustainably improve the performance of the business but recognise that it will be a multi-year journey.”
Big W recorded an 1H24 EBIT of $54 million, down 60 per cent on the prior year, with lower sales due to customers being more cautious, elevated wage inflation, and clearance activity to maintain inventory health having a material impact on earnings.
Banducci said the results were mixed, reflecting the solid performance of its Australian Food and B2B business and the New Zealand, Big W issues.
Australia Food H1 sales increased 5.4 per cent and EBIT was up 9.9 per cent. Two thirds of the business unit’s growth was attributable to WooliesX (including eComX, Cartology and Services), which is currently led by the incoming CEO, Amanda Bardwell.
eComX sales grew 21.3 per cent in the half due to strong growth in its Same Day offers, with eComX DAP up 185 per cent, driven by pick and delivery process optimisation and increased scale.
Banducci said, “WooliesX H1 total sales increased 27.5 per cent as we continued to provide more convenient options for customers with Direct to boot and Same Day propositions driving online growth.
“Woolworths Food Company’s own and exclusive brand sales increased by 6.8 per cent for the half with item growth in Long Life Food and Fresh as customers recognised the value offered by our own brands. The Pantry, Drinks and Household Care categories were particularly strong.
“Metro Food Stores sales increased 9.1 per cent in H1 supported by the opening of new stores and the continued recovery in customer mobility.”
Petstock was officially welcomed to the group in January. It will join Big W, MarketPlus, and HealthyLife as the company builds its general merchandise and speciality everyday needs business.
The Moorebank NDC is on track for practical completion in August and operational commission in H1 FY25. While the Moorebank RDC is also on track to go live in FY26.
The group installed solar panels on a further 19 supermarkets, five Big W stores, and two distribution centres in H1, bringing the company’s total count to 257 sites across ANZ.
It reduced Scope 1 and 2 emissions by 11.6 per cent compared to the prior corresponding period.
It also increased the volume of reusable plastic crates by nine per cent, or two million cycles.
Banducci said the company was making progress towards reinstating an in-store plastics collection and recycling program as part of the Soft Plastics Taskforce, with an in-store trial of a new collection scheme underway in five stores in metropolitan areas in Victoria.
“Together with our customers, we helped deliver over $11.5 million to our food relief charity partners including OzHarvest, Foodbank, and Fareshare in Australia, and The Salvation Army in New Zealand via our Christmas appeals and other giving programs.
“This supported the equivalent of over 18 million meals provided to those in need and diverted from landfill,” Banducci said.
