2008/07/18
WHL - Woolworths Holdings - Trading Update For The 53 Weeks Ended 30 June 2008 [JSE Securities Exchange - SENS]
 
WOWOW                                                                           
WHL - Woolworths Holdings - Trading Update For The 53 Weeks Ended 30 June 2008  
Woolworths Holdings Limited                                                     
(Incorporated in the Republic of South Africa)                                  
Registration number: 1929/001986/06                                             
Share code: WHL & ISIN: ZAE000063863                                            
("Woolworths Holdings" or "the group")                                          
TRADING UPDATE FOR THE 53 WEEKS ENDED 30 JUNE 2008                              
Trading conditions in the second half have deteriorated substantially with a    
further decline in consumer spending as a result of additional interest rate    
hikes and increases in fuel and food prices. Middle and upper middle income     
consumers have felt the pinch of the current economic conditions particularly   
strongly. This is the heartland of the Woolworths customer. We have accordingly 
adjusted our opening price point offer and given our continuing insistence on   
quality, our range now is extremely competitive.                                
The year ended 30 June 2008 had 53 trading weeks compared to the 52 weeks in    
last year.  Sales performance by the retail operations of the group during the  
period was as follows:                                                          
                        Sales growth    Comparable       Average                
                        for 30 June     store sales      inflation              
                        2008            growth                                  
                        53      52      53       52                             
                        weeks   weeks   weeks    weeks                          
                        vs 52   vs 52   vs 52    vs 52                          
Woolworths retail        13.3%   11.4%   7.3%     5.3%                          
Clothing and general     6.1%    4.4%    3.1%     1.6%    8.5%                  
merchandise                                                                     
Food                     18.8%   16.7%   9.9%     7.8%    13.1%                 
Country Road (A$)        21.9%*  21.9%   8.4%*    8.4%                          
Total group              15.5%   13.7%   8.3%     6.5%                          
* Country Road did not have a 53 week year.                                     
Trading space in Woolworths retail increased by 4.8% in clothing and general    
merchandise, and 14.4% in food at the end of June 2008, compared to the prior   
year.                                                                           
Woolworths Financial Services' combined debtors' books at June 2008 were flat   
against June 2007, although the average books for the year were 12.6% higher    
than the average for 2007. Interest yields increased to 23.5% (2007: 19.9%) and 
net bad debt expressed as a percent of the gross book, increased to 7.9% (2007: 
4.9%). There are some early indications that bad debt may have peaked.          
At the time of the interim results, management undertook to reduce cost growth  
for the second half and was successful in achieving this.  The Australian       
operation, Country Road, has shown resilience to the global slowdown, returning 
record profits.                                                                 
Growth in profit before tax and non-comparable items in the second half is      
expected to be positive.                                                        
Headline earnings per share ("heps") are adversely impacted by a R50million non-
comparable IFRS2 charge relating to the group's broad based BEE scheme and an   
increase in the effective tax rate of 8% as a result of the effect of last      
year's recognition of the deferred tax asset in Country Road and of STC on share
repurchases.                                                                    
On 17 July 2008, the South African Competition Authorities approved, without any
conditions, the acquisition by Absa of a 50% plus one ordinary share of         
Woolworths Financial Services (Proprietary) Limited. It is anticipated that the 
remaining conditions precedent will have been met by 31 August 2008.            
The above information has not been reviewed or reported on by the group's       
auditors.                                                                       
The group's financial results for the 53 weeks to 30 June 2008 are scheduled to 
be released on 21 August 2008.                                                  
Cape Town                                                                       
18 July 2008                                                                    
Sponsor                                                                         
RAND MERCHANT BANK (A division of FirstRand Bank Limited)                       
Date: 18/07/2008 13:01:56 Produced by the JSE SENS Department.                  
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