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Highlights

  • Woolworths is an ASX-listed retail company which operates in New Zealand and Australia
  • In 1HFY24, WOW’s NPAT before significant line items grew by 2.5% YoY to AUD 929 million
  • The Vanguard Group, Inc. has the maximum stake in the company with a shareholding of 4.99%

Founded in 1924, Woolworths Group Limited (ASX: WOW) is an Australia based food, general merchandise and specialty retailer, which operates across Australia and New Zealand. The segments of WOW include Australia Food, Endeavor Drinks, New Zealand Food, BIG W and Hotels.

In the first half of the financial year 2024 (1HFY24), the company recorded around 4.4% YoY rise in group sales to AUD 34,635 million, underpinned by the growth of e-commerce and growth in demand for meat, vegetables and fruits, attributed to better availability in stores and lower prices.

During the reported period, group EBITDA before significant items increased by 5.3% YoY to AUD 3,079 million, backed by Australian food and Australian B2B segments. Group NPAT before significant line items surged by 2.5% YoY to AUD 929 million.

Key drivers for retail sector

The labour force survey data released on 23 May 2024 by the Australia Bureau of Statistics indicated that postal,warehousing and transport sector and the retail trade sector witnessed QoQ growth in employment for the period ended 28 February 2024. The retail trade sector had 1,347,300 employees during the quarter ended February 2024, compared to 1,333,100 employees in November 2023 quarter.

Top 10 shareholders of WOW

The top 10 shareholders of WOW have nearly 24.48% shareholding in the firm. The Vanguard Group, Inc. and AustralianSuper have the maximum stake in the company, with a shareholding of approximately 4.99% and 4.98%, respectively.

Recent business update

Through an ASX update dated 2 May 2024, the company revealed that its revenue increased by 2.8% YoY to AUD 16,800 million during the third quarter of 2024, the growth is underpinned by increased revenue across Australian B2B, Australian food and New Zealand segments, partially offset by a fall in BIG W sales during the reported period.

Outlook

In 2HFY24, the company anticipates underlying cost inflation to remain high in Australia food segment. The company has introduced a productivity plan for FY24 and FY25.

In the 2HFY24, EBIT growth is anticipated to be lower than in the 1HFY24.

For BIG W segment, the company expects EBIT to be around its breakeven levels in 2HFY24.

Share performance of WOW

WOW shares closed 1.22% higher at AUD 31.460 apiece on 27 May 2024. With this, in the last one year, WOW’s share price has declined by 17.17% and in the past three months, it has dropped by 4.35%.

The 52-week high of WOW is AUD 40.350, recorded on 22 June 2023, and the 52-week low is AUD 30.120, recorded on 2 May 2024.

WOW Daily Technical Chart, Source: REFINITIV

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 27 May 2024. The reference data in this report has been partly sourced from REFINITIV.