The Woolworths Group – which operates in Australia and NZ and owns Big W – reported a 21 per cent drop in its net profit for the six months to January 5 to $739 million.
“In Australian Food, the team has worked incredibly hard to recover from the supply chain disruptions caused by industrial action in November and December,” said chief executive Amanda Bardwell.
“While we acknowledge the material impact of the industrial action on our customers and team, we came to an agreement that is fair and sustainable and enables ongoing productivity improvements critical to maintaining competitiveness.
“In Victoria, sales have not yet fully recovered but availability and customer metrics are returning to pre-disruption levels with ongoing efforts to regain customers.”
Bardwell said the group’s profit will continue feeling the impact of the ongoing cost of living crisis while customers look for budget alternatives.
The livestock costs for red meat may also contribute to the profit pain in the first half of 2025.
“While we continue to optimise our promotional activity, cost-of-living pressures for customers persist with value-seeking behaviours and cross-shopping expected to continue,” Bardwell added.
Woolworths also said the profit drop in grocery sales would have only been five per cent if not for the industrial action.
The supermarket’s Australian Food earnings included a one-off $95 million blow to profits.
This year, Woolworths said it will focus on providing “value” to customers including impactful promotions and “optimised ticket designs” to make sales prices stand out to shoppers.