Australia’s largest retailer Woolworths has seen its profit nosedive in its latest FY24 results posted on Wednesday.

It recorded a 93 per cent decrease in full-year net profit to $108 million after booking $1.7 billion in impairments related to the sale of a 5 per cent stake in pubs and drinks owner Endeavour Group as well as its struggling New Zealand supermarket arm.

In January, Woolworths booked $1.5 billion in significant items against its New Zealand supermarkets and another $209 million in impairments linked to the investment in the demerged Endeavour company.

Despite these latest results, it will reward its shareholders with a 40c a share special dividend.

Woolworths posted a 5.6 per cent increase in full-year sales to $67.92 billion and an underlying profit after tax – before significant items – of $1.71 billion, down 0.6 per cent.

When normalised for the 53 weeks in the trading year, against 52 weeks in 2023, sales rose 3.7 per cent and underlying profit was down 3 per cent.

Within the group, Woolworths supermarkets reported a 5.6 per cent lift in sales to $50.74 billion, while earnings rose 8.6 per cent to $3.11 billion.

Sales at its B2B food business, led by its PFD Food Services arm, rose 6.1 per cent to $4.6 billion as earnings climbed nearly 93 per cent to $122 million.

Meanwhile, at Big W, sales dropped 2.1 per cent to $4.69 billion, as earnings fell as much as 90 per cent to $14 million, which the group attributed to value-conscious shoppers “cross-shopping”.

Woolworths has had an improved momentum from July this year and into the new financial year with its Australian supermarkets posting a 3 per cent sales rise for the first eight weeks of fiscal 2025.

Group e-commerce sales in FY24 meanwhile reached almost $8 billion, with normalised sales up 18.5 per cent compared to the prior year and 19.1 per cent in H2.

The effect that the cost of living crisis is having on consumers and businesses is becoming increasingly apparent. “In the second half, inflation in our food businesses and BIG W moderated significantly as we lowered prices and passed on lower cost prices to customers. Average prices in Woolworths food retail in the third quarter and fourth quarter were down 0.2 per cent and 0.6 per cent respectively on the prior year,” said Woolworths Group CEO, Brad Banducci, who is handing over the reins to Amanda Bardwell.

“However, cost of living remains the primary concern for our customers, and we are committed to do more to help them in the current environment by offering more value on their shopping baskets and by supporting them with new digital tools, and extra value through Everyday Reward.”

Woolworths and Coles are believed to control around two-thirds of the Australian supermarket sector. This week, Coles reported a 8.3 per cent rise in annual profit to $1.1 billion.