Australia’s largest supermarket retailer, Woolworths, has posted a $1.62 billion after-tax profit for its continued operations in the 12 months to June, up 4.6 per cent.
But the results also revealed a 79.6 per cent drop in full-year profits to $1.6bn due to the sale of Endeavour Group, the firms’ drinks and hospitality arm, which caused profits to soar to $6.2bn in the 2022 financial year.
The result fell just short of analysts’ forecasts for a $1.7bn profit.
Despite a drop in consumer sentiment due to cost of living pressures, revenue rose to $64.3 billion, increasing by 5.7 per cent.
“The 2023 financial year marked a return to relative stability after several years of material Covid-related disruption,” said chief executive Brad Banducci,” Woolworths chief executive Brad Banducci said.
“Looking ahead to F24, we expect food inflation in Australia and New Zealand to continue to moderate but will likely remain elevated in some packaged categories.
“We also expect the consumer environment to remain challenging with customers continuing to cut back on non-essential items.”
As suppliers’ costs rose for commodities, energy and labour, Woolworths in-turn increased its final prices, especially in packaged items and dairy products.
Flooding also pushed prices for fruit and vegetable higher, although prices moderated in the six months to June 2023.
Woolworths’ department store brand Big W saw a bigger slowdown in spending as discretionary spending took a hit from the growing cost of living crunch.
The final dividend for the 2022-23 financial year climbed to 58c a share fully franked, up 9.4 per cent.
More to come.
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