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Woolworths sees full-year loss after David Jones impairment

Jul 19 2018 10:23
Vernon Wessels, Bloomberg

Woolworths [JSE:WHL] said charges related to its struggling Australian business will result in a full-year loss, its first in at least 16 years.

The company will probably report a per-share loss of between R3.40 to R3.97 for the 52 weeks ended June 24, the Cape Town-based company said in a statement on Thursday.

That will be the first annual loss since Bloomberg records on Woolworths began in 2002. Headline earnings per share, which exclude one-time items, fell as much as 20%.

The shares declined 1.2% in early trade in Johannesburg, extending declines for the year to 20%.

Woolworths is struggling to contend with difficult trading conditions in its main South African and Australian markets, with overall sales increasing 1.6% in the year.

Poor product choice in some areas of women’s wear resulted in a drop in South African fashion, beauty and home sales. Food revenue in the country rose by a “market-leading” 8.4%, the company said.

A revaluation of its David Jones business in Australia resulted in a noncash impairment charge of 712.5 million Australian dollars ($527m) in the first half, while the unit’s head was fired earlier this year. 

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woolworths  |  companies  |  retail


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