Woolworths Group reported a “disappointing” FY25, as its net profit dipped 17.1 per cent to $1.39 billion.
This excludes significant items amounting to $569 million, primarily reflecting impairments associated with BIG W, MyDeal and Healthylife.
EBIT fell 12.6 per cent to $2.75 billion, with the decline driven by Australian food and BIG W.
“We announced the closure of the MyDeal customer website and consolidated a number of businesses internally to improve performance and elevate focus on our cornerstone food business,” Amanda Bardwell, Woolworths Group CEO, said.
“New Zealand Food’s transformation delivered an improved performance in F25 while BIG W was below expectations with Clothing detracting from improvements in Play and Home. We will begin to transition BIG W to its own fit for purpose technology platform while remaining focused on improving the performance of the business.”
Meanwhile, the company’s sales rose 3.6 per cent to $69.08 billion as Australian food sales grew 3.1 per cent to $51.45 billion and Australian business-to-business sales climbed 4.1 per cent to $5.74 billion.
New Zealand food sales inched 1.9 per cent higher to $7.56 billion and W Living sales jumped 9.9 per cent to $5.64 billion.
Moving forward, the group expects a better FY26 as it works on becoming a “more focused, lower-cost retailer with a differentiated food offer at our core.”
“In F26 we expect to return to profit growth following a disappointing F25,” Bardwell said.
“Going forward, we want to ensure BIG W has the appropriate foundations to be successful. We have begun a process to unlock BIG W from Woolworths Group technology platforms. This will enable BIG W to have systems appropriate for a discount department store and is the right thing to do for BIG W and the Group.”
In the first eight weeks of FY26, the group witnessed a 2.1 per cent year-on-year increase in Australian food sales. Excluding tobacco, sales grew 4 per cent, driven by e-commerce.
New Zealand food sales grew 2.6 per cent, impacted by short-term competitor promotional activity, while BIG W’s sales remained broadly flat, cycling significant clearance activity in the prior year.
“F26 will be a transitional year as we focus on rebuilding momentum and restoring customer trust. Our current trading performance has been below our ambition with customers continuing to cross shop to find the best value,” Bardwell said.
“We acknowledge that it will take time for the full benefits of the actions we have taken and current priorities to be realised. We are also making progress on returning to the level of customer and retail execution excellence that we expect but there remains more to do.”
In addition, Woolworths announced the appointment of Ken Meyer as a non-executive director, effective October 1.
Meyer brings with him an extensive experience in food retail after spending 24 years at US-based Whole Foods Market.
Currently, Meyer serves as an executive partner at Chicago-based Shore Capital. He is also a founding partner at Midnight Ventures Partners.
Holly Kramer will retire at the conclusion of the 2025 Annual General Meeting after more than nine years of service as a non-executive director at Woolworths.
This article was originally published on RetailBiz.
