Woolworths Holdings reported a 24.8% profit decline in the first half due to weak clothing sales in South Africa and Australia. Headline earnings per share fell to 152.8 cents, prompting a 27.7% cut in the interim dividend to 107 cents. The company faces significant challenges in its clothing sector amid general economic pressures.
Woolworths Holdings, the prominent South African retailer, has reported a significant decline in profit for the first half of the fiscal year. The company’s profit fell by 24.8%, attributed to disappointing sales growth in its clothing division, both domestically and in Australia and New Zealand. Alongside this downturn, Woolworths operates food stores in South Africa, expanding its retail footprint beyond clothing.
The retailer stated that its headline earnings per share decreased to 152.8 South African cents for the 26-week period ending December 29, down from 203.3 cents recorded in the previous corresponding period ending December 24, 2023. This drop in earnings reflects the challenges the company faces in the competitive retail market, particularly in its clothing sector.
In light of the profit slump, Woolworths announced an interim dividend of 107 cents per share, representing a reduction of 27.7% compared to the prior year. This decision demonstrates the company’s cautious approach amid declining profit margins and ongoing retail challenges.
In summary, Woolworths Holdings has reported a notable profit decline of 24.8% for the first half of the fiscal year, driven by sluggish clothing sales in local and international markets. The decrease in headline earnings per share and the subsequent reduction in interim dividends reflect the company’s current challenges in the competitive retail landscape. Without a strategic turnaround, Woolworths may need to recalibrate its market strategies to enhance profitability and sales growth.
Original Source: www.tradingview.com
