JOHANNESBURG (Reuters) – South African food and fashion retailer Woolworths Holdings Ltd raised its profit growth forecast on Thursday, saying it now expected half-year earnings to jump as much as 80% on strong Black Friday sales and festive demand.
Brick-and-mortar sales increased substantially as shoppers returned to physical stores, particularly in Australia after prolonged pandemic lockdowns there that kept customers indoor.
Woolworths said it now expected headline earnings per share (HEPS) of between 285.9 and 302.8 cents for the six months ended Dec. 25, compared with last year’s 168.2 cents. HEPS is the main profit measure in South Africa.
In mid-November, the upmarket retailer had forecast a 20% rise in HEPS before accounting for Black Friday and festive sales.
Data from Statistics South Africa showed on Wednesday retail sales in the country rose 0.4% year-on-year in November after falling by a revised 0.7% in the previous month.
Woolworths’ turnover and concession sales increased by 18.5% on-year in the 26 weeks ended Dec. 25, and by 16.3% in constant currency terms as all businesses of the group expanded.
In South Africa, its fashion, beauty and home businesses saw an 11.2% growth in turnover and concession sales, due to full-price sales and as its turnaround strategy continued to gain traction.
The food business grew turnover and concession sales by 7.6%, despite disruption from rolling power cuts.
In Australia and New Zealand, upmarket department store chain David Jones and fashion group Country Road recovered from pandemic restrictions, as shoppers returned to stores even as increased inflationary pressures weighed on sentiment.
David Jones’ turnover and concession sales increased by 31.8%, while sales at Country Road Group grew by 25.5%.
Woolworths said it expected to conclude the sale of David Jones by the end of March.
(Reporting by Nqobile Dludla; Editing by Subhranshu Sahu)
