Wool­worths chair­man to step down as prof­its slide

Kalgoorlie Miner - - BUSINESS - Syd­ney

Wool­worths chair­man Ralph Wa­ters will step down af­ter the su­per­mar­ket gi­ant suf­fered a 12.5 per cent slide in its full-year profit.

Wool­worths made a net profit of $2.15 bil­lion for the year to June 30, down from $2.45 bil­lion in 2013-14.

Mr Wa­ters will leave the com­pany on Septem­ber 1, to be re­placed by vet­eran com­pany di­rec­tor and busi­ness­man Gor­don Cairns.

His de­par­ture fol­lows the an­nounce­ment chief ex­ec­u­tive Grant O’Brien would step down once a suc­ces­sor is found.

The slide in full-year profit comes as the com­pany’s su­per­mar­ket sec­tor faces tough com­pe­ti­tion from arch ri­val Coles and Ger­man re­tailer Aldi. Wool­worths’ core food and liquor busi­ness lifted to­tal sales 2.3 per cent for the year, while com­pa­ra­ble sales were up just 0.7 per cent.

By com­par­i­son, Coles recorded a 5.3 per cent rise in to­tal sales and a 3.9 per cent in­crease in com­pa­ra­ble sales for the same pe­riod.

Wool­worths spent more than $200 mil­lion on im­prov­ing its su­per­mar­kets in the sec­ond half of the year, in­clud­ing low­er­ing prices and im­prov­ing the qual­ity of its prod­ucts.

The ex­tra in­vest­ment in the su­per­mar­ket busi­ness con­trib­uted to the slide in net profit, which was also weighed down by other one-off costs, in­clud­ing $148 mil­lion linked to its ef­forts to turn around Big W and $43 mil­lion in re­dun­dancy costs.

Wool­worths main­tained its fully franked fi­nal div­i­dend of 72 cents per share. AAP

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