Woolworths Group reported Australian Food sales of $53.85 billion for F26, up 4.6 per cent, with segment EBIT of $2,953 million up 8.5 per cent on the prior year. Group sales reached $71.5 billion, up 3.6 per cent, with group EBIT before significant items of $3,105 million, up 12.7 per cent. Net profit after significant items was $1,138 million, up 18.1 per cent.
The headline food numbers flatter the underlying position. Both figures cycle the industrial action that hit the business in H1 F25 and carry supply chain implementation costs of $113 million. Stripping those out, Australian Food sales grew 4.1 per cent and EBIT grew 4.8 per cent. On the same basis, group EBIT growth was 8.7 per cent rather than 12.7 per cent.
Significant items of $718 million before tax were dominated by a $710 million provision for salaried team member remediation, recognised in H1 following the Federal Court decision of 5 September 2025 on historical underpayments of award-covered salaried store team leaders. A further $20 million in interest was recognised in H2.
Deflation in grocery, inflation in fresh
Average prices excluding tobacco fell in every quarter of F26. In Q4, total average prices were down 0.6 per cent and down 0.8 per cent excluding tobacco. Woolworths attributed grocery deflation to lower shelf prices and increased promotional activity around Easter, partly offset by inflation in fresh driven by higher lamb and beef prices.
The retailer said it invested more than $100 million in lower prices during the year and has more than 800 items on Lower Shelf Price at an average double-digit reduction.
Australian Food gross margin fell two basis points to 28.6 per cent, and 20 basis points excluding tobacco. Woolworths named price and promotional investment, meat input cost pressures and supply chain costs as the drivers. H2 gross margin was down 12 basis points, or 26 basis points excluding tobacco.
Cost of doing business fell 22 basis points on productivity work and above-store savings, which the group put at approximately $400 million across F26. Australian Food EBIT margin rose 20 basis points to 5.5 per cent.
Category performance
Fresh sales grew 6.9 per cent with double-digit growth in meat and strong growth in poultry and everyday chilled, which Woolworths linked to a strong promotional program, improved availability and increased demand for protein.
Grocery Food sales grew 7.1 per cent, with solid growth in drinks, breakfast, health and international foods, and snacking. Woolworths credited simplified ranges, availability and a shift toward Lower Shelf Prices.
Everyday Needs, including pet and baby, remained subdued but improved in H2 after price investment and range changes. Tobacco sales fell 43 per cent for the year, with the rate of decline moderating to 34 per cent in H2.
Own and exclusive brand sales increased 5.5 per cent, driven by meat and fresh. Woolworths launched more than 445 new own brand products in F26, including 41 new and 24 rebranded products across its globally inspired ranges La Mesita, Lantern Alley and La Gina. It also introduced 83 new and 60 reformulated ready-made meals produced through The Kitchenary, its vertically integrated meals facility.
Petstock own brand sales grew 27 per cent, with the Billie’s Bowl and Tilly’s pet food ranges extended into Woolworths Supermarkets in H2. Petstock sales rose 12.3 per cent to $964 million with EBIT up 33.5 per cent to $58 million.
Supply chain and B2B
The Moorebank national distribution centre is fully operational and the regional distribution centre is picking an average of more than 2.4 million cartons a week. Woolworths said it expects the benefits from both facilities to materially offset the implementation costs of its ongoing supply chain investment in F27.
Inventories rose $296 million to $4,465 million, which the group attributed in part to higher stock holdings to mitigate potential supply chain disruption. Closing inventory days increased 1.1 days.
Australian B2B sales increased 4.2 per cent to $5,983 million with EBIT up 13.0 per cent to $155 million. PFD sales grew 5.2 per cent with the quick service restaurant channel the strongest performer, though H2 growth slowed to 0.8 per cent, or 4.8 per cent on a comparable basis, on softer consumer demand in food service through March and April. Export meat sales rose 38.9 per cent on higher livestock supply.
Woolworths said its Voice of Supplier measure remained strong and stable across the year. Cartology revenue grew 7.8 per cent, accelerating to 11.3 per cent in H2.
Outlook
Woolworths Food Retail total sales rose 7.6 per cent in the first eight weeks of F27, with the group estimating that the Disney Ooshies collectibles program added approximately 1.5 to 2 percentage points of that growth.
Woolworths Group CEO, Amanda Bardwell, said cost pressure will continue to shape the year ahead.
“Customers are expected to remain value-focused in the year ahead and we are committed to limiting the impact of rising costs through low and dependable prices. Wage growth is also expected to remain elevated by historical standards reflecting the current year’s annual wage increase of 4.75 per cent in Australia and progressive changes to pay for our 18 and 19-year-old retail team members,” Bardwell said.
“These cost pressures challenge us to be even more efficient, leveraging technology to be more productive in order to reinvest back into the business for our customers.”
The board declared a fully franked final dividend of 52 cents per share, taking the F26 total to 97 cents, up 15.5 per cent.
