Woolworths Group’s sales increased by 5.7% to $67.2 billion in F21, according to the company’s latest results.
CEO Brad Banducci says F21 was a significant year in the history of Woolworths Group and one it can look back on proudly.
“We farewelled our Endeavour Group colleagues at the end of June following a multi-year journey to separate the business,” he says. “It was a bittersweet moment, but we are confident it was the right decision to enhance value for our shareholders.
“We also made progress in laying the foundations for the new Woolworths Group, a more focused food and everyday needs ecosystem with a ‘customer 1st team 1st’ culture at its core and enabled by data and technology.”
Mr Baducci notes that the Delta variant of Covid-19 has seen the operating environment change rapidly in the last three months.
“We are working hard to protect our team and continuing to provide food and everyday needs for our customers and the communities which we serve,” he says.
“It has become clear that vaccination is key to the safety of our team and the easing of restrictions, and we are committed to supporting vaccination efforts across the broader community.
“I want to express my deep gratitude to our team as they continue to demonstrate care for each other and our customers and acknowledge the government and industry for their support as we work through these challenging times together.”
Addressing sustainability
In November 2020, Woolworths launched its Group Sustainability Plan 2025 organised into three pillars: People, Planet and Product.
“We have made good progress on all three pillars, with further detail to be provided in our upcoming sustainability report and modern slavery statement,” says Mr Baducci.
“For our team, we introduced or enhanced initiatives to demonstrate our care and to create a great place to work. This included a celebration of our diversity reflected in our WGEA Employer of Choice for gender equality citation, Australian Workplace Equality Index Gold Tier Status for LGBTQ+ inclusion for the fourth consecutive year, and our partnership with Community Corporate, to deliver the Group’s Refugee Employment Program.
“On Planet, the Group has reduced scope 1 and 2 emissions by 27% compared to 2015 levels. Under our Product pillar, 2,571 tonnes of plastic was removed in F21.
“In December, Woolworths Group commissioned an independent review into the proposed Dan Murphy’s development in Darwin. Following receipt of the report, we decided to not proceed with the store and surrendered the licence to the NT government. In June, we released the full report, as well as Woolworths Group’s initial reflections on the report, which identified some immediate actions as well as other areas to address which require deeper thought and consideration.”
Australian Food
Australian Food F21 sales increased 5.4% to $44.4 billion, with comparable sales increasing 4.2% (4.5% excluding tobacco).
E-commerce sales increased 74.7% to $3.5 billion, with sales penetration for the year of 7.9%.
According to Woolworths, H1 sales growth of 10.6% benefitted from Covid-related demand and the successful Disney+ Ooshies and glass containers campaigns.
H2 sales increased 0.2% as the business cycled Covid-19 pantry-loading in the prior year.
In Q4, says Woolworths, total sales increased 1.2% and comparable sales increased by 0.1%, with cycling of prior year pantry-loading partly offset by elevated sales in May and June following Covid-19 outbreaks in Victoria and NSW and a strong trade plan throughout the year.
Own and Exclusive Brands sales increased 5.8% in F21 supported by new products developed by Woolworths FoodCo and launched during the year.
Metro Food Stores F21 sales declined 4.9% to $897 million, impacted by reduced foot traffic across CBD and transit locations, with comparable sales declining approximately 45% and 30%, respectively.
During the year, 23 new stores were opened. This included 13 supermarkets and 10 Metro Food Stores, with 65 Renewals completed.
Two new dedicated e-commerce fulfilment centres were also opened in Notting Hill (Vic) and Lidcombe (NSW), and the first eStore in Australia, Carrum Downs (Vic).
At the end of the year, there were 996 supermarkets, 78 Metro Food Stores and two Summergate stores, with a total fleet of 1,076 stores.
WooliesX
WooliesX’s digital and media business reported an increase in average weekly traffic to Woolworths’ websites and apps of 25.8% to 12.1 million in F21.
Improving customer satisfaction with their digital experiences, in particular helping inspire, plan and shop safely remained the focus.
Key upgrades to experiences included personalised lists, the launch of Fresh Ideas for You on the Woolworths App, addition of new recipes and launching in-app push notifications.
Cartology, according to Woolworths, continued to enhance its client experience through expanded inventory and data-led customer insights and achieved strong growth across all key advertising channels. By year end, Cartology digital advertising screens had been rolled out to 1218 stores across Woolworths supermarkets and Dan Murphy’s.
Over the year, the business says it met the demand for increased convenience by adding 379 direct to boot sites assisting pick up penetration to reach 37.5% of sales in Q4.
Another 125 Delivery Now locations were added, and same day delivery was rolled out to 425 stores where customers can order and receive their order within a one-hour window later in the day.
Woolworths at Work was launched to provide businesses with a tailored online shopping experience. The platform provides access to features such as line of credit, consolidated billing, and two-hour delivery windows.
Everyday Rewards members increased 6.0% to 13.1 million, with scan rates improving to 53.7% by year end.
The Everyday Rewards app, says Woolworths, continues to provide value and convenience to members across partners, with the ability to boost offers, check points balance and access eReceipts.
The Everyday Rewards program, adds Woolworths, increased the value available to customers by adding new partners, including Origin Energy, SuperPharmacy and Pet Culture.
“Strong member engagement with record levels of interest and participation were driven by the Rewards exclusive glass container collectable and Bank for Christmas offering, as well as the ability for members to continue to earn Qantas Points,” says the business.
Wpay was also launched as a standalone payments business in June. Woolworths says it will offer customers cost effective solutions such as transaction processing, settlement services, in-store terminals, custom gifting and loyalty initiatives and reporting and analytics.