Woolworths said trading in its Australian apparel business slowed sharply at the end of the first half, while stepped-up investment in its South African food division weighed on margins.
The Australian market “is highly promotionally driven,” chief executive officer Roy Bagattini said in an interview on Wednesday.
“There’s not much that you buy in Australia today that is not on sale or not with a discounted price ticket. So those businesses are sitting with a lot of inventory, particularly in discretionary categories.”
In South Africa, the Cape Town-based company added capacity at its Midrand food-distribution centre.
Food accounts for 64% of total revenue and there are “a number of new opportunities we are going after” especially in food services, Bagattini said.
That includes Woolworths cafés, coffee shops, takeaway restaurants and school tuck shops.
The cost of the new food-distribution centre, together with more discounts to clear excess inventory and lowered
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