Woolies Dash has been experiencing significant growth lately. Woolworth’s Food business saw a 46.6% increase in online sales year over year, although it still falls short of Checkers Sixty60’s record.
Woolies Dash is Experiencing a Significant Growth Lately
In the 26 weeks leading up to December 26, 2023, Woolworth’s Food business had a 46.6% year-over-year rise in online sales, driven primarily by greater media attention to the retailer’s on-demand delivery initiative, Woolies Dash.
Woolworths Food’s contribution to divisional sales in South Africa was 5.1% due to the growth in the first half. Due in large part to Shoprite Holdings’ industry-leading Checkers Sixty60 app, which gained popularity during the COVID-19 outbreak when people were urged to stay at home, the on-demand grocery shopping sector in South Africa has expanded rapidly in recent years.
Shoprite announced 63.1% half-year sales growth for Sixty60 at the end of January. However, checkers, Pick n Pay, Woolworths, and Spar are right now competing for market share in the congested market with Massmart-owned OneCart, an app that is independent of retailers, and Zulzi.
Woolworths Records a 7.5% Decline in Half-year Earnings Overall
As consumers reduced their discretionary spending as South Africa’s energy and logistical problems persisted, Woolworths reported a 7.5% decline in half-year earnings overall.
The retailer of food, fashion, and beauty products, catering to middle-class to upper-class customers, reported a decline in headline profits per share from continuing operations to 203.3c from 219.9c in the previous year. Heps saw a 31% decrease in overall operations.
Except for retailer David Jones, which it sold last year, group turnover, and concession sales from ongoing operations. It increased by 5.4% to R38.1 billion, or 4.4% in constant currency terms. Pre-tax profit decreased by 14.2% to R2.5 billion.
Woolworths Explains that ‘Its Earnings Were Affected by an Increasingly Difficult Macroeconomic Environment’
Given the ongoing impact of interest rate increases and rising living expenses, Woolworths said that its earnings were affected by an increasingly difficult macroeconomic environment. It said to Australia, “This negatively impacted footfall, resulting in a greater-than-expected pullback in discretionary spend in both geographies.”
Higher frequency of power outages, equipment malfunctions at ports, and the impact of avian flu on the supply of important food product lines all further hampered corporate operations in South Africa.
Due to low product availability, partly due to the late arrival of some summer lines, the port congestion limited the increase of concession sales and turnover at Woolworths’ fashion beauty and home sector to 2.2%.
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