Retail giant Woolworths is expecting a huge hike in earnings while fighting off load shedding as more people return to stores.
In a trading statement on Wednesday (16 November), the group said that showed that turnover and concession sales for the 20 weeks ended 13 November 2022 increased by 23.3% compared to the 20 weeks ended 14 November 2021.
The group said that the return of customers to physical brick-and-mortar stores contributed to the increase in physical sales.
In South Africa, Woolworths’ Fashion Beauty Home (FBH) business has a great start to 2022 as its turnover and concession sales grew by 10.8% and by 10.9% when compared on a store basis.
Woolworths said that it is continuing to focus on improving the underlying financial health of its businesses, specifically the fashion, beauty and home sectors.
The group reported its most profitable winter sale to date, with full-priced sales growing by 15.2% and clearance sales down by more than 20%.
Despite their FBH business thriving, the group reported that trading space reduced by 2.4% over the prior period as online sales grew by 1.5% – contributing to 4.2% of South African sales.
Woolworth’s food business also reported a growing turnover and concession sales by 7.3% and 5.1% on a comparable store basis.
One of the most significant increases reported was the 26% hike in online sales for groceries and other store goods. This contributed to 3.6% of the group’s total South African sales – aided by the expansion of its on-demand offering, Woolies Dash.
The group said that this was notwithstanding the considerable disruption caused by load shedding.
Load shedding has had a pronounced impact on our predominantly fresh categories across the business, said Woolworths.
Rolling blackouts contributed directly to:
- Foregone sales;
- An increase in produce waste;
- Significant increases in diesel costs to support trade.
“Price movement averaged 6.3% for the period, with underlying product inflation of 7.9%, as we continue to invest in price to improve our overall value proposition.”
Woolworths said that the trading space for its food business increased when compared to the year before, getting 3.2% bigger.
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