Woolworths group sales increase
Woolworths’ intentions to become the leading retailer in the Southern Hemisphere appear to be on track if its half year results are anything to go by. Releasing its interim results this week, the group’s sales have increased by 55.2%. Food sales increased by 14.1%, with a price movement of 9.5%. Sales in comparable stores grew by 8.2%. Retail space, including stores in the rest of Africa, grew by 10.7%. Clothing sales in South Africa increased by 9.4% and by 3.4% in comparable stores. Retail space, including stores in the rest of Africa, grew by 5.7%.
The Woolworths financial services debtors’ book reflected year-on-year growth of 10.3% at the end of December 2014, with an annualised impairment rate for the six months to 31 December 2014 at 4.8%. Woolworths appears to be in a rising tide, achieving three year compounded profit growth of 22.9%, while group turnover surged to N$39.7 billion, marking a 14.4% increase. Notable achievements for the group is its food division reporting growth in excess of its peers according to Woolworths Chief Executive Officer Ian Moir. He said, “Africa is performing well with good performance particularly in Mauritius, Kenya and Zambia. We closed our operations in Nigeria, as it became apparent that it was more of a northern hemisphere business with challenges in the supply chain compromising our ability to provide a credible offering to customers.” The acquisition of Australian high end department store has played well, making up 42.7% of the total. The N$21.4 billion acquisition of the David Jones brand has been described as a perfect fit by Woolworths executives. A number of synergies are to be enjoyed which include; increased sales of higher margin private label products within David Jones stores, optimising David Jones’ real estate portfolio and the integration of David Jones’ sourcing platform into the Group’s overall sourcing strategy, to lower the cost of goods.