Woolies continues to struggle
UK retailer Woolworths today said trading at its high street stores continued to be difficult and warned England’s participation in the World Cup would reduce the number of customers in the short term.
Reporting a 6.7% decrease in like-for-like sales in its retail arm for the 19 weeks to June 10, Woolies said it was continuing to reshape the business, including shutting a number of stores and refitting others.
One bright spot proved to be the sale of Easter eggs during the period, which “produced a positive result despite the difficult market”.
Woolworths, whose 800 stores are highly dependent on seasonal spending, said strong competition together with a weak market had affected its entertainment division, which sells DVDs and CDs to other retailers. Total group sales for retail and entertainment wholesale decreased 0.4% in the period.
However, outdoor living and outdoor toys posted good year-on-year increases.
Speaking ahead of the company’s annual meeting, chairman Gerald Corbett said Woolies continued to become more efficient, with stocks currently £15m (€22m) below last year’s level.
Some 54 stores were closed during the period for a refit and sales following the changes have been encouraging, he said.
Mr Corbett added: “The first half results will carry the costs of the stock and supply chain measures which have been initiated to generate improved performance particularly over the crucial Christmas trading period.
“It is also important that we continue to invest in the business.”
Earlier this year, Woolworths lost a contract to supply Tesco with entertainment products and Mr Corbett said the firm was seeking new customers to replace lost business.
