Woolworths has announced its full year results, which saw earnings skyrocket by 77.8 per cent to $2.07 billion, and the announcement of a $2bn share buyback.
Overall sales for the 12 months to 27 June increased by 5.7 per cent to $67bn, spurred by strong supermarket sales. However Metro stores continued to feel the impact of reduced foot traffic due to COVID.
In Australian Food, sales increased by 5.4 per cent to $44.4bn, with H2 sales increasing by 0.2 per cent as it cycled the impact of COVID from late February onwards.
In Woolworths Supermarkets, store-originated sales increased by two per cent for the year, driven by a 7.2 per cent increase in H1. Sales slowed as expected in H2 as customers shopped more frequently with smaller basket sizes.
Highlights for the year included 65 renewals and 13 new Supermarkets, including the launch of a community innovation store in Cabramatta.
Metro Food Stores sales declined by 4.9 per cent, impacted by lower sales from stores in CBDs and transit locations. But neighbourhood Metro’s continued to perform strongly with 10 new stores opened during the year.
Australian Food e-commerce sales through WooliesX increased by 74.7 per cent compared to the prior year, with e-commerce penetration of 7.9 per cent of sales. Q4 sales increased by 36.5 per cent despite growth of 69 per cent in Q4 last year.
Two new customer fulfilment centres were opened, and Woolworths announced a new automated facility to be built in Auburn to service Western Sydney. Further capacity was added with Direct to boot available in 629 stores by year end, driving the increase in pick up mix.
The Group’s continued investment in e-commerce has helped to drive $5.5bn overall sales growth this year.
Woolworths shareholders will be paid a dividend of 55 cents per share and have the opportunity to participate in the $2bn share buyback.
The buyback will be conducted through a tender process, which opens on 13 September. It will run until 15 October with a capital component of $4.31 per share, with the remaining balance issued as a fully franked dividend. Woolworths is ultimately expecting to release $840m of franking credits.
Woolworths Group CEO, Brad Banducci, said: “It was another challenging year for our team and communities but also a year where we achieved a lot together. COVID will continue to have a profound impact in F22 but making any further predictions about the year ahead remains very difficult.
“Our commitment to operating COVIDSafe remains our number one priority with the ability to respond quickly and effectively to restrictions becoming part of the way we do business. We are confident that we have the right foundations in place to continue to deliver value for all our key stakeholders in the years ahead.”