Supermarket chain’s profit slips by 23%

Woolworths NZ, which trades as Countdown, saw its profit slip 23% to just over $158 million in the year to June 26, despite widespread concerns over rising supermarket prices. The trading result posted to the Companies Office confirmed the Australian-owned firm’s revenues rose just over 6% to just under $7.6 billion. But that was eclipsed by a 6% rise in its purchasing costs and a 14% rise to its store, warehousing and administration expenses which sent its total expenses up by more than 7%. The net profit is the lowest Woolworths NZ has reported since it posted a $155m profit in 2017. The timing of the trading period means its result could have been impacted by the supermarket group’s decision to freeze the price of about 600 goods over winter in the midst of concerns over the rising cost of living and Government discussions over regulatory intervention. Woolworths NZ disclosed in August that it expected its operating profit for the year had fallen 12.5% to $316m. Its managing director, Spencer Sonn, said then that price competition across the retail food sector was robust. The company’s financial statements showed its annual online sales had topped $1b and now account for more than a sixth of its total retail sales. Despite the lower profit, Woolworths NZ agreed to increase the ordinary dividend it paid to its ASX-listed owner to $75m, from $53m last year.