WOOLIES: 5,822 +74 (+1.29%)
Woolworths sees 2019 profit hit as writes down Australian unit
(Recasts with impairment on David Jones)
JOHANNESBURG, Aug 1 (Reuters) - South Africa's Woolworths
Holdings expects full year earnings to decline as it
again wrote down the value of its David Jones business due to
structural changes that have hurt the Australian retail sector.
Woolworths, which sells clothes and organic food, said it
would book an impairment of 437.4 million Australian dollars
($299.27 million) against David Jones, reducing the valuation of
the upmarket chain to about 965 million Australian dollars.
Its shares fell 2.18% to 53.80 rand at the open.
"This write-down reflects sustained and unprecedented
economic pressures and structural changes in the Australian
market," a Woolworths spokeswoman said.
"The retail sector in Australia is currently in recession
and the Australian economy has slowed to its weakest level since
the global financial crisis in 2009."
The retailer, which has operations in 11 African countries
also said the performance of the David Jones business had also
fallen short of expectations.
In 2018, Woolworths booked a non-cash impairment charge of
712.5 million Australian dollars against the value of David
Jones due to the same reasons.
It said that it expected a loss per share for the full year
of between 92.4 cents and 129.3 cents, compared to a loss of
369.5 cents in the same period last year.
Headline earnings per share, which exclude the write down,
are expected to either decline by 3.5% or rise by 1.5% from
HEPS is the main profit gauge in South Africa and strips out
certain one-off items.
($1 = 1.4616 Australian dollars)
(Reporting by Nqobile Dludla and Onke Ngcuka, editing by Deepa
Babington and Emelia Sithole-Matarise)
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