Woolworths back on trend

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Woolworths back on trend

Published Date: 2019-07-12 | Source: Stephen Gunnion | Author: Stephen Gunnion

Woolworths back on trend

Sales at the retailer's Fashion, Beauty and Home divisions have picked up but conditions in Australia remain challenging.

Woolworths has reported a turnaround in sales at its Fashion, Beauty and Home division, sending its shares almost 9% higher yesterday. After a disappointing first-half, which resulted in a 2% decline in sales from the division, it said they rose 5.5% in the second six-month period.

In a trading update, the retail group said the turnaround was due to a focus on core ranges and basics, backed by improvement availability. It raised prices on fashion by an average 2.5% over the course of the year.

Meanwhile, foods sales momentum continued in the second half, expanding by 9%, with comparable sales growth of 6.5%. It said space growth was limited in both businesses as it focused on productivity and operating efficiencies.

In Australia, it said retail trading conditions remained changing. Its David Jones department store chain was also affected by a refurbishment of its Elizabeth Street store, which disrupted sales. It said the refurbishment was on track to be completed early in 2020. That was partly offset by a 47% rise in online sales, which now contribute 7.7% of total sales at David Jones. Country Road Group grew online sales in Australasia by 12.9%, with online now representing just over 20% of total sales. Woolworths said reducing unproductive space remained a priority as online sales increase in Australia.

Its results for the 53 weeks to 30 June are scheduled for release on 29 August. It closed 7.9% higher at R52.95 yesterday.





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