Woolworths Group recorded $31.9 billion in revenue, up 8 per cent on the prior corresponding period (pcp), in what CEO Brad Banducci called, “one of the most challenging halves we have experienced”.
Consumers spending big over Christmas after a challenging year of Covid lockdowns and restrictions was a theme mirrored by both Woolworths and Coles.
Ecommerce sales were up 48 per cent pcp to $3.5 million as the staffing and supply chain woes of Omicron were playing out.
Snapshot
- sales revenue up 8% to $31.89bn, (excluding PFD and Quantium, sales were up 4.2%);
- EBIT down 11% to $1.3bn;
- NPAT down 6.5% to $795m;
Its Australian Food business EBIT declined by 7.6 per cent to $1.2 billion due to higher operating costs, delayed productivity initiatives, and on-shelf availability issues caused by the ongoing pandemic.
Total Australian Food sales were up 3.4 per cent to $23.8 billion, and Woolworths Supermarkets (store originated) sales were $20.6 billion. Metro Food Store sales increased 7.2 percent to $489 million, driven by new store growth and strong sales in suburban stores, despite CBD and transit stores continuing to be impacted by reduced foot traffic.
Woolworths Retail sales increased 3.2 per cent, with ecommerce offsetting a small decline in store-originated sales.
Woolies B2C eCommerce sales grew 50.5 per cent in the half, accounting for a 10.8 per cent sales penetration overall, peaking at 15 per cent during Q1. Pick up mix remained high at 39.2 per cent in Q2 due to the ongoing growth of direct to boot. Pick up penetration reached 39.2 per cent of sales in Q2, with direct to boot expanded and now available in 653 stores.
While ecommerce profitability did improve, it is still below the company's Australian Food average margin. Approximately 90 per cent of ecommerce sales were fulfilled by the Woolworths Supermarket network.
The company forecast expects inflation to continue trending upwards and shelf prices to rise 2-3 per cent in the second half.
