Thursday, May 19, 2022

Woolworths reports strong third quarter growth

Woolworths Group’s Third Quarter Sales Results for the 13-week period ended 3 April 2022 were strong, says CEO Brad Banducci. But the period was not without its challenges.

“High levels of Covid-related team absenteeism and the disruption to our broader supply chain resulted in inconsistent customer shopping experiences and negatively impacted our customer metrics,” Mr Banducci said.

“Pleasingly, in recent weeks, we have begun to see more stability across the Group but store stock service levels remain below normal levels.”

Total Australian Food sales for the quarter increased 5.4% to $11.4 billion, with Woolworths Retail sales increasing by 5.2%.

Woolworths Retail sales were said to have benefited from a successful trade plan, including prices dropped on healthier products, elevated Covid-19 impacted in-home consumption, and shelf price inflation due to input cost pressures.

Average prices (excluding tobacco) increased 2.7%, with increasing shelf price inflation driven by industry-wide input cost pressures and lower promotional penetration due to stock availability challenges. Notable increases in long life categories included drinks and household care; and in fresh included meat (most notably beef) with higher commodity cost prices, and vegetables with supply impacted by poor growing conditions and flooding. Fruit remained deflationary driven by apples and avocados.

Mr Banducci acknowledged the cost-of-living pressures that are being felt by customers.

“We are working hard to ensure all of our customers ‘Get Their Woolies Worth’ through our enhanced Low Price program, our great value Own Brands, Specials and continued enhancements to Everyday Rewards,” he said.

The Woolworths Food Company’s own and exclusive sales increased 5.4%, supported by strong new product development and growth of key brands in fresh, including the COOK, Thomas Dux and Macro ranges. Over 140 products were launched in Q3 and an additional 650 products have been put on low price for winter.

In Q3’22, one new Metro Food Store was opened with three store closures (two supermarkets and one Metro Food Store). Fourteen renewals were completed. At the end of the quarter, there were 999 supermarkets and 82 Metro Food Stores with a total fleet of 1,081 stores.

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