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WOOLWORTHS HOLDINGS LIMITED - Trading update: 53 weeks ended 30 June 2019

Release Date: 11/07/2019 09:11
Code(s): WHL WHL02 WHL03 WHL01     PDF:  
 
Wrap Text
Trading update: 53 weeks ended 30 June 2019

Woolworths Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1929/001986/06
Share code: WHL
Share ISIN: ZAE000063863
Bond code: WHLI
('the Group')

TRADING UPDATE: 53 WEEKS ENDED 30 JUNE 2019

TRADING UPDATE

The year ended 30 June 2019 ('current year') had 53 trading weeks compared to 52 trading weeks for
the year ended 24 June 2018 ('prior year').

Sales performance of the Group for the current year was as follows:

                                               Total sales             Comparable       Price      Net retail
                                               growth*                 sales growth*    movement   space
                                               53 weeks    52 weeks    52 weeks
Group                                          5.9%        3.9%
Group (constant currency)                      5.1%        3.2%
Woolworths Fashion, Beauty and
Home                                           3.5%        1.5%        1.0%             3.6%       -0.1%
Woolworths Food                                9.8%        7.7%        5.4%             1.8%        2.0%
David Jones (A$)                               1.0%       -0.8%       -0.1%                         0.4%
Country Road Group (A$)                        2.3%        0.5%       -0.6%                        -2.9%

* Excludes impact of IFRS 15 'Revenue from Contracts with Customers'

The commentary below relates to a 52-week period, which is comparable to the prior year.

In South Africa, after a 2.0% decline in sales in the first half, Woolworths Fashion, Beauty and Home
sales performance improved in the second half, growing by 5.5% (5.0% after adjusting for the pre-
Christmas trade day included in the second half), with comparable sales of 4.7%. This is as a result of
a focus on core ranges and basics, backed by improved availability. Price movement for the year for
Fashion was 2.5%. Food sales momentum continued into the second half with growth of 9.0% (8.4%
after adjusting for the pre-Christmas trade day included in the second half), with comparable sales of
6.5%. This was driven by further investment in price, innovation and convenience, resulting in continued
volume growth. Space growth has been limited in both businesses, as we focus on productivity and
operating efficiencies.

The Woolworths Financial Services book reflected positive year-on-year growth of 7.4%. The
impairment rate for the 12 months ended 30 June 2019 was 3.7% under IFRS 9 (4.6% adjusted under
IAS 39; 4.7% under IAS 39 for the 12 months ended 30 June 2018). The Group implemented IFRS 9
with effect from 1 July 2018.

Retail trading conditions in Australia remain challenging. David Jones was also significantly impacted
by sales disruption resulting from the Elizabeth Street store refurbishment, which is on track to be
completed by the third quarter of the 2020 financial year. Online sales at David Jones grew by 46.8%,                                                                                                     
and now contribute 7.7% of total sales. In Country Road Group, while sales growth in the second half
was also impacted by the trading conditions, online sales in Australasia grew by 12.9%, representing
20.3% of sales. As the contribution from online sales increases the reduction in unproductive space
remains a priority.

CONSTANT CURRENCY AND PRO FORMA INFORMATION

The constant currency information contained in this announcement has been presented to illustrate the
impact of changes in the Group's major foreign currency, the Australian dollar. In determining the
constant currency turnover and concession sales growth rate, turnover and concession sales
denominated in Australian dollars for the current year have been adjusted by application of the
aggregated monthly average Australian dollar exchange rate for the prior year. The foreign currency
fluctuations of our rest of Africa operations are not considered material, and have therefore not been
applied in determining the constant currency turnover and concession sales growth rate. The
aggregated monthly average Australian dollar exchange rate is R10.15 for the current year and R9.97
for the prior year.

The Group manages its retail operations on a 52-week basis and, as a result, a 53rd week is required
approximately every six years for realignment. The current year has 53 weeks. To facilitate comparison
against the 52-week prior year, financial information for the current year has been presented on a 52
week basis, constituting pro forma information in terms of the JSE Limited ('JSE') Listings Requirements.

Furthermore, the impact of IFRS 15 'Revenue from Contracts with Customers' has been excluded to
facilitate comparison against the prior year, which also constitutes pro forma information in terms of the
JSE Listings Requirements.

The constant currency and pro forma information, which is the responsibility of the Group's directors,
has been prepared for illustrative purposes only, and may not fairly present the Group's financial
position, changes in equity, cash flows or results of operations.

The information contained in this announcement, including estimated financial information, constant
currency and pro forma information, has not been reviewed or reported on by the Group's external
auditors.

The Group's year-end results for the 53-week period ended 30 June 2019 are scheduled to be
announced on the SENS on or about 29 August 2019.

Contact:
Reeza Isaacs (Group Finance Director) on 021 407 2464
Ralph Buddle (Director: Strategy and Business Development) on 021 407 3250
InvestorRelations@woolworths.co.za

Cape Town
11 July 2019

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)


Date: 11/07/2019 09:11:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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