Woolworths has delivered its first quarter sales result, with CEO Brad Banducci saying a “low growth drinks market” and inclement weather are the reasons behind a lower trend result for Endeavour Drinks Group (EDG).
EDG delivered sales growth of three per cent, and comparable sales growth of 1.7 per cent, while slower sales in ALH Hotels were impacted by the cycling of key events.
Speaking about the EDG result, Banducci said: “Endeavour Drinks reported comparable sales growth of 1.7 per cent for the quarter, driven primarily by a low growth drinks market and the inclement weather we have experienced across the Eastern Seaboard of Australia in particular in July and August and into September in New South Wales.
“Sales increased three per cent to $2.1bn and online sales continued to deliver double-digit growth. During the quarter BWS on-demand was rolled-out to 472 stores, with plans to reach over 500 by Christmas.”
The double-digit online growth for EDG is a strong performance in a difficult quarter and now means that Dan Murphy’s online penetration is approximately seven per cent of sales, with an equal split between pick-up and delivery.
During the quarter, eight BWS stores were opened and three were closed and one Dan Murphy’s was opened and another closed bringing total store numbers to 1,321 and 227 respectively.
For ALH Hotels, total sales increased by 0.5 per cent in the quarter to $443m, with comparable sales increasing by 1.2 per cent. Comparable sales growth was lower than the same quarter last year, which Woolworths said was down to two major televised sporting events which did not repeat this year.
By category, Accommodation delivered the strongest growth in the quarter but Woolworths said that Bars was “the weakest in a challenging on-premise environment”. The number of Hotels remained unchanged at 323 during the quarter.
Speaking for the overall group, Banducci said: “In summary, while a challenging quarter for the group at the sales levels, we are pleased with the continued strength in our customer and brand metrics and the improved sales momentum we experienced towards the end of the quarter.
“We have strong plans in place for the lead-up to Christmas and the New Year to deliver the best experience possible in-store and online for our customers. I would like to thank our customers and team, for their ongoing support especially in helping us do the right thing for our community and environment.”