Woolworths announced financial results showing a $175m increase in net profit to $1.14bn for the year to June, with profit margins expanding from 5.3% to 5.5% in its Australian supermarkets division. Sales in the supermarket division climbed 4.6% to $53.85bn, while pre-tax earnings rose $232m to exceed $2.95bn. The retailer’s market value surged $2bn following the announcement, briefly exceeding $50bn for the first time since 2021.
Chief executive Amanda Bardwell attributed the profit growth to increased customer traffic and purchasing volumes rather than higher shelf prices, stating the company had not lifted margins through price increases. She indicated that shoppers had adopted a more permanent focus on value-seeking behavior, describing it as “entrenched value seeking” rather than temporary cost-conscious shopping patterns. The company achieved margin improvements through administrative cost reductions and declining inventory losses, including theft prevention measures such as exit gates and trials of facial recognition technology at stores in New Zealand.
Woolworths’ results followed a similar pattern to rival Coles, which reported higher supermarket profit margins rising from 5.3% to 5.7%, described as the highest level since at least 2019. Online sales across Woolworths grew 15.9% as the company expanded in-store pickup and on-demand options. The Ooshies promotional campaign, offering collectible Disney character toys with supermarket purchases, boosted sales by approximately 2% during an eight-week period, accounting for over $120m in additional revenue.
Woolworths’ Big W department store division returned to profitability with pre-tax earnings of $64m, reversing a $33m loss from the previous year, though recent sales have declined despite participation in the Ooshies program. The company attributed the weakness to ongoing cost-of-living pressures on households. Industry analysts suggested regulatory scrutiny would likely constrain Woolworths’ ability to significantly expand margins further, with profit growth expected to remain incremental.
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