Woolworths sees 20% profit plunge amid tough retail market
South African retailer Woolworths has weathered a tumultuous year, with annual earnings expected to plummet by more than 20% following the sale of its David Jones business and widespread consumer belt-tightening. Amidst challenging trading conditions exacerbated by high interest rates and living costs, Woolworths faces tough times in its apparel sector, while its food business shines with robust trade and market share gains. The company's struggles highlight the stark realities of a retail landscape grappling with economic pressures and shifting consumer behaviours.
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Reuters
South African retailer Woolworths said it expected annual earnings to be more than 20% lower than the prior year, partly impacted by the sale of its David Jones business and consumers cutting down on discretionary spending.
Retailers such as Woolworths have been grappling with challenging trading conditions at a time cash-strapped customers rein in spending amid high interest rates and living costs.
Woolworths, which also operates in Australia, said trading conditions in the second half to date have been tougher than expected for its apparel businesses.
The food, fashion and beauty products retailer said its Country Road Group business in Australia was being further impacted by inflated import costs due to a weaker currency, coupled with higher fixed costs.
The company, however, said its food business continued to prove its resilience, with strong trade and market share gains.
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SOURCE: REUTERS