Woolworths online sales jump 48% in H1 2022
Woolworths Group said while its supermarket stores continued to be impacted by COVID-19 closures in the first half of financial year 2022, it resulted in a significant shift of customers to its e-commerce platforms.
The shift is reflected in the Australian grocery retail giant’s latest half-year results, with the company saying the group’s e-commerce sales jumped 48% year-on-year to A$3.5 billion for the period. . E-commerce sales penetration increased from 8.1% to 11.6% and average weekly traffic to the group’s digital platforms jumped 30.5% to A$23 million.
“While the far-reaching impacts of COVID resulted in one of the toughest halves we’ve seen, we closed the first half strong with positive business momentum and helped our customers enjoy a festive Christmas and a much-needed festive season,” said Woolworths Group CEO Brad. said Banducci.
Group sales increased 8% year-on-year to A$32 billion for the period ended 2 January 2022.
Of the group’s total sales, its Australian food business contributed A$23.8 billion, after rising 3.4% in the first half. Breaking this down, the company’s digital arm, Woolies X, contributed A$2.6m, after gaining 50.5% in the half-year, with sales penetration of 10.8% . This growth helped offset a slight 0.7% drop in in-store sales which closed the period at A$20.6 billion.
“Around 90% of e-commerce sales were made through the Woolworths supermarket network,” the company said.
Woolworths also noted that its WooliesX business saw “record visits” to its digital platforms due to increased app usage. The app’s weekly active users rose 50% in December from a year earlier, while its Everyday Rewards app hit more than one million weekly active users in the second quarter. At the end of the semester, there were 13.3 million registered Everyday Rewards members.
As part of its half-year results, the company took the opportunity to highlight that it has established its advanced analytics platform, Q-Retail, in partnership with analytics firm Quantum, where Woolworths has a majority stake, and that Quantium has signed agreements with Telstra and Asda.
Woolworths also said it uncovered a one-time additional cost of A$144 million in unpaid wages through a payroll review it began last year. This is on top of having already paid over A$427 million in underpayments that the company uncovered in 2020.
“We are disappointed to have inadvertently identified further underpayments and we apologize unreservedly to our team members involved. We will continue to resolve issues as we identify them and put the right controls in place to prevent ‘They don’t breed,’ Banducci said.
Woolworths closed the half with group profit after tax up 6.5% year on year at A$850 million, and group profit before interest and tax of A$1.4 billion , down 11%.