By Andrew Starke
Woolworth’s CEO, Michael Luscombe, announced ‘solid’ first quarter sales figures yesterday (Oct 20), although some analysts have expressed disappointment with the result.
Sales for the quarter were up 4.2 percent to $13.4 billion, with 7.4 percent growth recorded if petrol is excluded. Analysts had expected growth of between eight and nine percent.
Australian food and liquor sales for the quarter increased 7.8 percent, with the comparable store sales figure at 5.8 percent.
This latter figure compares favourably with growth of 7.9 percent in the fourth quarter of 2009 and 6 percent for the same quarter last year.
Woolworths does not unbundle its food and liquor figures further when delivering sales results.
“This sales result is a solid start to the financial year reflecting our continued focus and investment to deliver value and enhance the customer experience,” said Luscombe.
He attributed the company’s growth in the food and liquor division to product range, store format and the commencement of an alliance with the Qantas Frequent Flyer program.
Sales from Woolworth’s hotel business increased by one percent in the quarter to $303 million, but comparable sales were down by 1.2 percent.
Gaming comparable sales were also down as a result of Queensland operations which were impacted by a reduction in legislated trading hours.
Woolworth’s shares, which had risen from $29.23 to $30.52 over the past week, slumped on the back of the sales result announcement and were trading at $29.98 at midday today.