Sharechat Logo

Woolworths' NZ Countdown chain lifts FY earnings 3.5 percent as market remains ‘challenging’

Wednesday 28th August 2013

Text too small?

Australian supermarket chain Woolworths lifts annual earnings at its New Zealand Countdown stores by 3.5 percent as it grabbed market share in a "challenging" trading environment.

Normalised earnings before interest and tax, which strips out an extra week of trading in the 2013 year, rose to $302.7 million in the 12 months ended June 30 from $287.4 million a year earlier, the Sydney -based company said in a statement. Earnings were dragged down by a $7.7 million charge for extra rental costs after the group spun off its real estate assets into SCA Property Group.

Normalised sales climbed 2.3 percent to $5.75 billion, opening eight new stores in the year and closing three, and gross margin widened 3 basis points to 23.3 percent.

"This is a solid result given the New Zealand retail environment has been characterised by low growth and low inflation with retail trading conditions increasingly challenging during the year," the company said.

Government figures earlier this month showed New Zealand retail spending on supermarket and grocery items increased 0.4 percent to $16.81 billion in the 12 months ended June 30 from a year earlier. Consumer prices for grocery food fell 1.5 percent in the three months ended June 30 from the same period in 2012.

Woolworths lifted group profit 24 percent to A$2.26 billion on sales of A$59.16 billion, as it came from a lower base when it wore a A$383.7 million impairment charge on the now divested Dick Smith Electronics unit.

Last week the Australian company bought New Zealand apparel and homeware retailer EziBuy for $350 million in a deal it expects will act as a launching pad for Woolworths' next growth phase, leveraging on its direct marketing via online and catalogue sales.

The ASX-listed shares gained 1.5 percent to A$34.38 in trading today, and have gained 16 percent this year.

NOTE: please be advised to read full articles from Business Desk Website, you will have to pay a subscription fee on their website.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar holds gains on improved dairy, bank capital outlook
MARKET CLOSE: NZ shares gain; banks rally on Reserve Bank capital decision
NZ dollar rises; bank capital rules less harsh than expected
RBNZ relaxes capital requirements, allows preference shares, extends phase-in
NZ dollar extends gain amid mixed US data, possible trade progress
MARKET CLOSE: NZ shares dip on eve of major regulatory decisions
NZ dollar sees off global headwinds, holds above 65 US cents
NZ dollar holds above 65 US cents; dairy auction prices mixed
Dairy index falls on weaker butter, milk fat demand
MARKET CLOSE: NZ shares join global decline; US tariff move weighs on exporters

IRG See IRG research reports