Woolworths BWS

Woolworths Group CEO Brad Banducci has said that because of the continued uncertainty around when lockdown restrictions will be eased across Australia, Woolworths is delaying its planned separation of Endeavour Group.

Speaking at a Woolworths Group trading update this morning, Banducci said that while venues are starting to reopen he expects ALH to continue to be a loss-making business until full service has resumed.

“ALH venues are beginning to reopen, but the conditions of reopening differ by state,” Banducci said. “As a result sales remain materially below prior year levels and the business is expected to continue to be loss-making until more venues operate with a full service offer.

“Given the continued uncertainty around when this may be, it appear unlikely that the Endeavour Group separation can take place before the second half of calendar year 2021. However we remain committed to the separation of the business at the appropriate time as we believe it remains value-increasive for shareholders.”

The update also revealed that the group’s trading outside of the hotels business has been strong.

Banducci said: “Trading has remained strong in Q4 to date, with the exception of Hotels where venues were closed until the end of May and have just begun to enter different stages of reopening. In Australian Food and Endeavour Drinks, sales growth improved in May and June following a more subdued April impacted by unusual trading patterns around Easter and Anzac Day.”

However due to the COVID lockdown Banducci revealed that Hotels EBIT is expected to be $160m-$170m, significantly down on last year’s $355m.

For the financial year 2020, the Group currently expects to report EBIT of $3.2bn-$3.25bn, FY19 Group EBIT was $3.29bn on a 53-week basis.

All numbers are still subject to year-end finalisation, auditor review and Board approval, with full year results scheduled for 27 August 2020.

Andy Young

Andy joined Intermedia as Editor of The Shout in 2015, writing news on a daily basis and also writing features for National Liquor News. Now Managing Editor of both The Shout and Bars and Clubs.

Leave a comment

Your email address will not be published. Required fields are marked *