Food spurs Woolies growth but toasters off the menu as Big W weakens
Woolworths Group boss Brad Banducci expects food prices to continue to come down this year, but says consumers are noticeably pulling back spending at its discount chain Big W where shoppers are shunning bigger items such as small appliances.
He said sales in the first eight weeks of the year were similar to the fourth quarter across the business, with Big W sales declining 6 per cent in a more challenging discretionary sector.
“Inflation is showing promising signs of moderation, but our operating costs will be impacted as we continue to invest with wage increases, and manage ongoing inflation in energy and transport,” he told media.
Woolworths Group CEO Brad Banducci outside the Tamworth store.
Mr Banducci said that at Woolworths Food Retail (which is made up of supermarkets, Metro food stores and e-commerce), sales growth for the new year to date remained strong at 6.5 per cent.
“Inflation has continued to moderate with item growth in the low single-digits benefitting from strong volume growth in fruit and vegetables,” he said.
Mr Banducci’s comments came as he revealed a 5.7 per cent rise in sales to $64.29 billion, thanks to its Australian food business where revenue climbed 5 per cent and earnings soared.
The nation’s biggest grocery chain said sales in its Australian food business reached $48 billion in the 52 weeks to June 25, with same-store sales up 4.2 per cent. Sales at WooliesX rose 5.6 per cent with Direct to Boot and Same Day propositions driving online growth.
The second half reflected higher prices of grocery items, which returned to modest growth from the third quarter, and boosted by e-commerce sales growth.
The stock rose 3 per cent to $37.34 each in early trade on Wednesday.
Group earnings before
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