Saturday, June 22, 2024

Woolworths releases 2023 third quarter results

Woolworths has released its 2023 third quarter results, with Group sales revenue increasing by 8% to $16.34 billion.

Across its Australian Food division, sales increased 7.6% in Q3 to $12.3 billion with Woolworths Food Retail and WooliesX (including e-commerce) sales increasing by 7.4% and 9% respectively.

“In general, customer spending is stable,” says Woolworths Group CEO Brad Banducci.

“However, value-conscious customers are becoming more thoughtful about their discretionary spend, trading into more affordable options such as our own brands and looking for additional ways to save in store or through our digital, Rewards and e-commerce platforms.

“Our current focus is on continuing to improve our customer experience, especially value for money and product availability, and we remain cautiously optimistic that Woolworths Group is well placed to navigate and respond to the current trading challenges successfully for all key stakeholders – our customers, our team, our suppliers and community partners, and our shareholders.”

Supermarkets

Woolworths supermarkets sales for Q3 were $10.7 billion, an increase of 6.9% (8.6% excluding tobacco) on the prior year.

B2C e-commerce sales returned to growth in Q3 increasing by 8% to $1.2 billion. E-commerce sales penetration in the quarter was 9.9% compared to 9.8% penetration in prior year and 9.3% in Q2.

Metro

Metro food stores sales were $309 million, an increase of 27.9%, after cycling Covid-impacted sales in the prior year.

Digital

WooliesX total sales for Q3 were $1546 million, an increase of 12.8%. This was driven by growth across all platforms.

B2C e-commerce sales increased 8% to $1206 million driven by increased demand for convenience with Same Day and Delivery Now both growing “strongly”.

Woolworths says its Direct to Boot service continues to resonate with customers with Direct to Boot capabilities added to a further 30 stores with the service now available in 708 stores.

Weekly average traffic to Woolworths’ digital platforms reached 23.1 million, up 27.6% on the prior year.

Average weekly traffic to the Food and Everyday Rewards digital platforms reached 15.6 million, up 27.9%.

Digital tools such as personalised shopping lists and recipes continue to grow in customer importance, according to Woolworths, with shopping list, recipe and digital catalogue users adding two to four additional items to their shopping baskets.

Cartology had a “strong” quarter growing 39% compared to the prior year as it cycled Covid-related disruptions and benefitted from the “successful” execution of the Bricks Farm Collectibles program in Woolworths supermarkets.

Prices

Average prices in Q3 increased by 5.8% compared to the prior year with long life inflation driven by supplier cost price increases.

Woolworths says improved fruit and vegetable growing conditions, lower livestock prices and the cycling of inflation in the prior year contributed to the moderation compared to the Q2 increase of 7.7%.

Stores

Three renewals (two supermarkets and one Metro) were completed, and two new Metro food stores were opened in Q3.

At quarter end, the retailer’s fleet comprised 1003 Woolworths supermarkets, 92 Metro food stores, seven CFCs and two eStores.

The quarter also marked the five-year anniversary of Mini Woolies which provides valuable life skills to special education schools and adult learning centres. A further four stores opened in Q3 bringing the total to 35 Mini Woolies stores.

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