First half sales increase for Endeavour Drinks Group
Woolworths has reported the first half of its 2018 financial and revealed Endeavour Drinks Group (EDG) saw a sales increase of 4.8 per cent to $4.5bn in the six months up to the end of December 2017.
In its report Woolworths said that the increase was driven by strong sales growth from BWS and Dan Murphy’s, with both stores “continuing to outgrow the market”. The report also said that Dan Murphy’s December volume growth and attached BWS stores sales momentum were “highlights” during the half-year.
Woolworths Group CEO Brad Banducci said: “Endeavour Drinks delivered strong sales growth in a competitive market. Both retail banners outgrew the market in the first half with December sales for both Dan Murphy’s and BWS a highlight. EBIT growth was slower, impacted by price investment to match competitor offers and cycling the gain on sale of a business in the prior period.”
He added: “In terms of drinks, we are continuing to evolve our drinks business as we work hard to deliver against what is rapidly changing set of customer expectations around both the breadth of offer and convenience.
“Online continues to grow strongly, with double digit growth from both Dan Murphy’s and BWS.
“BWS had an especially pleasing first half, off the back of the strengthening participation in Woolworths rewards and the work done in customer-first ranging. BWS also expanded their convenience offer with express delivery available at 300 stores during the half and I think it’s just over 500 as I speak today.”
The group also highlighted the key priorities in growing its EDG business as:
- Strong sales growth from BWS and Dan Murphy’s
- High double-digit online sales growth in BWS, Dan Murphy’s and Langton’s
- Over 300 BWS stores now offering express and scheduled delivery from store
- Steve Donohue appointed as Managing Director, replacing Martin Smith who is retiring
- More work to do to meet our customers’ increasing need for convenience
Overall Woolworths reported a $902m profit for the half, up 14.7 per cent on the prior corresponding period, as Banducci continues to guide the group through its turnaround, following its expensive di-vestment.
“At the end of FY17, we said that we were moving from turnaround to transformation. In the current half we have seen some early signs of this transformation with good progress on a number of strategic initiatives and pleasing sales growth from all of our businesses. We remain committed to our focus on building a customer and store-led culture and team with a highlight in the half being the continued improvement in customer, team and supplier advocacy scores across the Woolworths Group,” Banducci said.
Woolworths Group Chairman, Gordon Cairns, said: “We are pleased that the Woolworths Group has been able to deliver a strong half of sales and profit growth as well as continued investment for the long-term and a meaningful reduction in net debt. We have made good progress in the transformation of the business but we continue to see significant opportunity for further improvement. Reflecting the improved profit result for the half and cash generation, the Woolworths Group Board has announced a dividend of 43 cents per share, a 26.5 per cent increase on the prior year.”