South African retailer Woolworths has reported a 17.7% fall in half-year profits on the back of weakness in womenswear sales.
The company sells food, clothing, and homewares and also owns Country Road Group and David Jones, both of which are apparel retailers in Australia.
For the 26 weeks to 29 December, headline earnings per share fell to ZAR164.9 (US$10.9) from ZAR200.4 the previous year.
Turnover and concession sales grew 3.8% to ZAR40.9bn, hit by a 53-week year in 2019 that impacted trading, compared to the prior financial year because Christmas week trading falls into the 2020 first-half financial year results.
In its Woolworths fashion, beauty and home division, sales grew by 2.2%, or 0.9% after adjusting for the shift in trading weeks.
“Our Black Friday performance was disappointing due to under-participation. Womenswear underperformed as a result of some product failure, a lack of newness in summer and higher price points, which also impacted sales and volumes,” the retailer said.
Looking ahead, Woolworths said consumers remain under pressure from a weak economy amidst continued power outages. It will focus on improving performance through better pricing and ranges, particularly in womenswear.
The performance follows a warning last month that profits for the half-year would be impacted by a “constrained economic environment” and unseasonal weather, which impacted December trade. The announcement came amid the appointment of former vice president of Levi Strauss Americas, Roy Bagattini, as CEO.
