The research, used in a financial results presentation by Woolworths CEO Simon Susman, serves to emphasise just how much Woolies shoppers have been hit by economic conditions. Susman is the first CEO of a major retailer to say that the sector is in a recession.
Susman was releasing his results yesterday at Woolworths' Hyde Park store. Staff were in full attendance and there was no evidence of protests in support of a demand for union recognition.
Sapa reported that the SA Commercial, Catering and Allied Workers' Union (Saccawu) said the protest action came “after a drawn-out and currently unresolved organisational rights dispute”.
Zyda Rylands, CEO of support services at Woolworths, said all Woolworths stores were trading, but reported lower earnings for the year to June.
Woolworths reported a 15.5% rise in turnover and 6% increase in profit before tax, exceptional items and a charge for a empowerment transaction. Woolworths customers have been particularly hard hit by the slowing economy and the retailer has lost market share. Bad debts deteriorated rapidly in the first half of the financial year.
However, Woolworths' Australian company, Country Road, produced record profit. Country Road clothing is now available at a few stores locally, in upmarket areas. Susman said some stores were opened too close to existing stores, and some were opened in middle income areas where consumers were under pressure.
Nevertheless, new stores have generally been very profitable.
Africa's third-largest distributor of consumer goods Massmart, which owns Makro, Game, Dion and Builders Warehouse, among others, continued to do well in the year to June.
At Massmart, food and liquor sales showed strong growth of 17%, general merchandise sales were up by 11% and home improvement sales grew by 14%.
Source: Business Times
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