Woolworths half-year profit increases

Press, Volume CXV, Issue 33929, 23 August 1975, Page 19

Woolworths half-year profit increases

The unaudited group net profit of Woolworths, Ltd, for the sis months to July 31 was $5,121,000, compared with $4,325,000 for the previous corresponding period and an increase of $796,000 or 18.-1 pel cent, the directors say.

Sales for the half-year, rose 22.2 per cent to $473.9m. “The retail industry generally has greater sales and profit in the second half of the calendar year, because of seasonal and Christmas trad-

ling, and the higher proportion of non-food sales at that period,” the directors say. “The company’s financial year concludes at the end of January, and therefore the lesser proportion of sales and profit occurs in I the first half of its financial ! year. “For example, in 1974! sales for the six months to July represented 47 per cent! of sales for that year, and' operating profit for the! period was 37 per cent of! the annual profit.” The increases in profit! and sales were achieved as a result of aggressive trading,: better use of the company’s resources, additional contri-i butions for new ? stores! opened in recent years, and! the continued effort to re-! duce administrative overhead; costs.

Inflation at the rate of 17! per cent continued to be the] company’s greatest concern.; It meant that virtually all i retained profit had to be used to meet the inflated cost of stock which, in turn, limited capital available for development. “Our capacity to absorb cost increases is virtually exhausted, and the recently announced freight, postal, and telephone increases, together with wage indexation, must result in higher retail prices,” the report says. “This is regrettable, but is the inevitable consequence of our high level of national inflation. “It is difficult to see how

this can be reduced substantially until the Government, employers, and employees work together to achieve higher productivity.” An unchanged interim dividend of 5 per cent (2.5 c a share) will be paid on October 31.