Woolworths Overtakes Coles Sales Growth But Big W Drags Down Profit

Woolworths has returned to profit in the first half of the financial year, recovering from significant losses caused by the closure of Masters.

Net profit for the Woolworths group rose 174.6% from the first half of the previous financial year to $725.3 milllion.

Comparable sales growth for Woolworths supermarkets was also up 1.9% during the half year. The company highlighted a 3.1% rise in comparable sales growth for the second quarter, beating out Coles for the first time since September 2009. Coles previously reported 0.9% growth during the period.

“This momentum gives us confidence that, while we still have a lot to do, we are on the right track,” said Brad Banducci, Woolworths CEO.

Big W contributed to an overall 16.7% decline in net profit for Woolworths’ continuing operations to $785.7 million. Pre-tax profit for the chain, which chairman Gordon Cairns called “significantly challenged” last year, dropped 88.9% to $8.1 million, alongside a 6.3% fall in comparable sales.

“We are currently reviewing the BIG W strategic plan and this will be completed in the next few months,” Mr Banducci said.

Woolworths also announced a reduced dividend for the period, falling 22.7% to 34 cents.