Supermarket giant Woolworths has cut its dividend after posting a big decline in full-year profit.
The retailer delivered a $1.39 billion net profit in the 52 weeks to June 29, down 17.1 per cent from Woolworth’s the previous financial year after normalising the reporting period, it announced on Wednesday.
Woolworths will pay a 45-cent final dividend, down 21.1 per cent from last year’s 57-cent payout.
Sales were up 3.6 per cent to $69.1 billion, while earnings before interest, tax, depreciation and amortisation fell 3.5 per cent to $5.7 billion on a normalised basis.
Woolworths’ results came a day after rival Coles reported its sales in the year to June 29 had also risen 3.6 per cent on its previous financial year (which was a week longer). Coles reported sales of $44.3 billion for the period on Tuesday, with supermarket sales up 4.3 per cent to $40 billion – a 5.7 per cent increase when excluding tobacco products – and sales from its Liquorland stores rising 1.1 per cent to $3.7 billion.
Coles turned a $1.1 billion profit, up 2.4 per cent from 2024/25.
Woolworths said its drop in profit reflected higher finance costs and lower earnings, which were hit by numerous issues.
Industrial action in the first half cost the group $95 million, and the group spent $73 million in dual-running costs as new high-tech warehouses begin operation.
Woolworths’ cost of doing business also rose, mostly because of a 4.25 per cent wage increase for Australian retail team members.
In addition it posted $569 million in impairments, including writing off $346 million from the value of Big W after a financial performance below expectations.
CEO Amanda Bardwell described the 2024/25 results as disappointing, but said the group expected to return to profit growth in this financial year.
“We will continue to rebuild customer trust through compelling value and retail execution excellence, simplify the way we work and become a more focused, lower-cost retailer with a differentiated Food offer at our core,” she said on Wednesday.
“Some of this will take time, but I am confident that the strength of our brands, assets and team can see us deliver a much-improved performance.”
Woolworths also said for the first eight weeks of 2025/26, Australian supermarket sales were up 2.1 per cent compared to the previous year, or up 4 per cent excluding tobacco sales.
-with AAP
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