2015/02/12
WOWOW - WOOLWORTHS HOLDINGS LIMITED - Unaudited Interim Group Results for the 26 weeks ended 28 December 2014 and Cash Dividend Declaration [JSE Securities Exchange - SENS]
 
Unaudited Interim Group Results for the 26 weeks ended 28 December 2014 and Cash Dividend Declaration

Woolworths Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1929/001986/06
Share code: WHL
ISIN: ZAE000063863
("the group" or "the company")


UNAUDITED INTERIM GROUP RESULTS 
FOR THE 26 WEEKS ENDED 28 DECEMBER 2014 AND CASH DIVIDEND DECLARATION
 

FINANCIAL HIGHLIGHTS

TURNOVER AND CONCESSION SALES: +55.2% 
HEADLINE EARNINGS PER SHARE: +5.7% 
ADJUSTED HEADLINE EARNINGS PER SHARE: +29.3%
RETURN ON EQUITY: 30.0% 
INTERIM DIVIDEND PER SHARE: 96.5 cents


COMMENTARY
During the period, the Group acquired the Australian department store business David Jones and the Country
Road Group's minorities interests. 

Group sales including concession sales increased by 55.2%.

Basic and headline earnings grew 9.5% and 14.7% respectively, whilst adjusted headline earnings
increased by 40.3%. Adjustments comprise transaction and other acquisition-related costs of R307 million,
commitment fees and other non-interest finance costs totaling R164 million related to bridge facilities ahead
of the Group's rights offer on 26th September 2014, and unrealised foreign exchange gains of R36 million
(December 2013: R54 million losses) relating to inventory hedging.

Due to the increase in the number of shares in issue on completion of the rights offer, earnings per share and
headline earnings per share increased by 0.9% and 5.7% respectively, and adjusted headline earnings per
share increased by 29.3%. For comparative purposes, the weighted average number of shares for the prior
period has been adjusted by the bonus element of the rights issue, as required by IAS 33: Earnings per share.

WOOLWORTHS
CLOTHING AND GENERAL MERCHANDISE
South African clothing sales (including Country Road Group's sales in South Africa) grew 9.4% and 3.4% in
comparable stores. Core merchandise in menswear and womenswear performed well, whilst kidswear and
footwear underperformed. Total Clothing and General Merchandise sales grew 8.0%.

Gross profit margin increased by 1.6% mainly as a result of the conversion of previously-franchised stores in
Botswana and Namibia.

Store costs increased by 22.5% with the addition of the converted stores, as well as by a net 4.4% increase in
new space. Other operating costs grew 10.0%. This increase in costs constrained growth in operating profit
to 2.7%. Return on sales declined marginally to 17.6%.

FOOD
A strong performance from Food saw sales grow well ahead of the market at 14.1%, with price movement
of 9.5%. Sales in comparable stores grew 8.2%. Gross profit margin was maintained at 25.2% despite a
marginally higher mix of branded products.

Store costs increased by 13.6% with the addition of a net 10.1% in new space. Other operating costs were well
controlled, growing 6.9%. Operating profit grew 24.3% and return on sales improved 0.5% to 6.7%.

WOOLWORTHS FINANCIAL SERVICES
The business experienced growth in the average debtors book of 10.5%, with the impairment rate (including
collection costs) normalising - but still at an industry leading level - of 4.8% (December 2013: 4.3%). Net interest
income grew 16.9% and operating costs reduced by 4.0% providing for a 34.7% increase in profit before tax.
Return on equity remains at 29.4% (December 2013: 24.2%), well above the medium-term target of 22.0%.


DAVID JONES
The results of David Jones for the five months from acquisition date of 1st August 2014 are included for the first
time and consequently no comparative figures are presented. However against a pro-forma comparable
5-month period, the business increased turnover including concession sales by 2.0% in Australian dollar terms
and operating profit of $107 million was 10.3% higher than the pro-forma prior period.

It is also important to note that in line with other Australian department stores, David Jones earns a larger
proportion of its profits during the first half of the year due to Christmas trade.


COUNTRY ROAD GROUP
Sales increased by 9.2% in Australian dollar terms. Sales in comparable stores increased by 5.3% and net
space increased by 9.0% in Australasia.

Gross margin declined 0.7% due to higher markdowns particularly in Country Road womenswear. Operating
costs continued to be well controlled, resulting in a 9.4% increase in operating profit.

OUTLOOK
We believe that economic conditions in South Africa will remain constrained, especially in the lower and
middle income segments of the market where consumer debt levels are still recovering. Sales may be further
impacted by load shedding. The upper income segment in which we operate continues to show resilience.
We continue to trade ahead of the market and trading for the first six weeks of the new financial year has
been positive.

In Australia there are early signs of an improved retail environment and we expect sales in both David Jones
and the Country Road Group to be ahead of the market.

Any reference to future financial performance included in this statement has not been reviewed and reported
on by the company's external auditors and does not constitute an earnings forecast.

CHANGES TO THE BOARD OF DIRECTORS
The Board is pleased to announce that Patrick Allaway, an Australian national, was appointed as a non-executive
director with effect from 1 December 2014.

Hubert Brody and Nombulelo Moholi were appointed as non-executive directors to the Board in July 2014.
Zarina Bassa became chairman of the Risk and Compliance Committee in February 2015 and Thina Siwendu took
over the chairmanship of the Social and Ethics committee from Chris Nissen who retired at the conclusion of the
AGM held on 26 November 2014. The Board expresses its deepest gratitude to Chris for his contribution, pursuing
with passion the delivery of our transformation strategy.

S N Susman                                              I Moir
Chairman                                                Group chief executive officer

Cape Town, 11 February 2015


DIVIDEND DECLARATION
Notice is hereby given that the directors have declared an interim gross cash dividend of 96.5 cents (82.025 cents
net of dividend withholding tax) per ordinary share for the 26 weeks ended 28 December 2014. The dividend has
been declared from income reserves and a dividend withholding tax of 15% will be applicable to all shareholders
who are not exempt.

The issued share capital at the declaration date is 1 014 808 547 ordinary shares and 89 192 746 preference shares (unlisted).

The salient dates for the dividend will be as follows:

Last day of trade to receive a dividend   Friday, 27 February 2015   
Shares commence trading "ex" dividend         Monday, 2 March 2015   
Record date                                   Friday, 6 March 2015   
Payment date                                  Monday, 9 March 2015   


Share certificates may not be dematerialised or rematerialised between Monday, 2 March 2015 and Friday,
6 March 2015, both days inclusive.

An interim gross cash dividend of 96.5 cents (82.025 cents net of dividend withholding tax) per preference
share (unlisted) for the 26 weeks ended 28 December 2014 will be paid to the beneficiaries of the Woolworths Employee
Share Ownership Scheme on Monday, 9 March 2015.

Thobeka Sishuba-Mashego
Group secretary
Cape Town, 11 February 2015

INTERIM GROUP STATEMENT OF COMPREHENSIVE INCOME

 Restated*                                                                                                           Restated*
 52 weeks                                                                                              26 weeks       26 weeks
to 29 Jun                                   to 28 Dec      to 29 Dec
     2014                                                                                                  2014           2013           %
       Rm                                                                                     Notes          Rm             Rm      change
   39 944     Revenue                                           28 460         19 454        46.3
   40 012     Turnover and concession sales                                                      6.2     30 283         19 520        55.2
    (305)     Concession sales                                                                   6.2    (2 559)          (138)        amp;gt;100
   39 707     Turnover                                                               27 724         19 382        43.0
   24 209     Cost of sales                                                                              16 243         11 828        37.3
   15 498     Gross profit                                                                               11 481          7 554        52.0
      125     Other revenue                                                                                 652             45        amp;gt;100
   11 680     Expenses                                                                                    9 119          5 513        65.4
    7 614     Store costs                                                                                 6 365          3 668        73.5
    4 066     Other operating costs                                                                       2 754          1 845        49.3
    3 943     Operating profit                                                                            3 014          2 086        44.5
      112     Investment income                                                                              84             27       amp;gt;100
      136     Finance costs                                                                                 887             37        amp;gt;100
    3 919     Profit before earnings from joint ventures and associate                                    2 211          2 076         6.5
      181     Earnings from joint ventures    119             88        35.2
        4     Earnings from associate                                                                         1              1           -
    4 104     Profit before tax                                                                           2 331          2 165         7.7
    1 114     Tax                     684            598        14.4
    2 990     Profit for the period                                                                       1 647          1 567         5.1
              Other comprehensive income:
              Amounts that may be reclassified to profit or loss
    (182)     Net fair value adjustments on financial instruments, after tax      340           (20)
      177     Exchange differences on translation of foreign subsidiaries                                 (921)             63
              Amounts that may not be reclassified to profit or loss
      (6)     Post-retirement medical benefit liability-actuarial (loss)/gain, after tax                      -              -
     (11)     Other comprehensive income for the period                                                   (581)             43
    2 979     Total comprehensive income for the period                                                   1 066          1 610
    2 990     Profit attributable to:                                                                     1 647          1 567
    2 888     Shareholders of the parent                                   1 645          1 505
      102     Non-controlling interests                                                                       2             62
    2 979     Total comprehensive income attributable to:                                                 1 066          1 610
    2 868     Shareholders of the parent                1 058          1 531
      111     Non-controlling interests                                                                       8             79
              Reconciliation of headline earnings
    2 888     Earnings attributable to shareholders of the parent                                         1 645          1 505        9.3
      103     BEE preference dividend                                                             60             58        3.4
    2 785     Basic earnings                                                                              1 585          1 447        9.5
              Loss/(profit) on disposal of property, plant and equipment, intangible assets
     (35)     and investment properties                              2              -
       16     Net impairment of property, plant and equipment and intangible assets                         116             10
        3     Tax impact of adjustments                                                                    (33)            (1)
    2 769     Headline earnings       1 670          1 456       14.7
      182     Transaction costs                                                                             260              -
        -     Integration and restructuring costs                                                            47              -
        -     Non-recurring finance costs                                                                   164              -
      139     Unrealised foreign exchange (gains)/losses                                                   (36)             54
     (72)     Tax impact of adjustments                                                                     (8)           (15)
    3 018     Adjusted headline earnings                                                                  2 097          1 495       40.3
    350.6     Earnings per share (cents)                                                       2 & 6.1    184.2          182.5        0.9
    348.6     Headline earnings per share (cents)                                                         194.1          183.6        5.7
    379.9     Adjusted headline earnings per share (cents)                                                243.8          188.5       29.3
    346.2     Diluted earnings per share (cents)                                               2 & 6.1    182.6          179.6        1.7
    344.2     Diluted headline earnings per share (cents)                                                 192.4          180.8        6.4
    375.1     Adjusted diluted headline earnings per share (cents)                241.5          185.6       30.1
    759.5     Number of shares in issue (millions)                                                        928.0          759.3       22.2
    794.4     Weighted average number of shares in issue (millions)                                       860.3          792.9        8.5

 
*Certain comparative amounts shown do not correspond to the 2014 Interim and Annual Financial Statements and reflect adjustments
 made. Refer to note 6.

INTERIM GROUP STATEMENT OF FINANCIAL POSITION

At 29 Jun                                                                       At 28 Dec    At 29 Dec
     2014                                                                            2014         2013
       Rm         Notes       Rm           Rm
            ASSETS
    8 192   Non-current assets                                                     33 086        6 968
    3 404   Property, plant and equipment                                     3    13 679        2 903
      115   Investment properties                                             3        79           36
    2 946   Intangible assets                                           3    16 562        2 403
        2   Investment in associate                                                     2            -
      799   Investment in joint ventures                                              864          764
       30   Participation in export partnerships                                       24           35
        -   Fair value lease adjustment                                       8        83            -
      106   Other loans                                                                74           69
        -   Derivative financial instruments                                  9        47            -
      790   Deferred tax                                                            1 672          758
   14 077   Current assets                                                         10 852        6 007
    3 436   Inventories                                                             5 676        3 229
    1 067   Trade and other receivables                                             1 729          801
       23   Derivative financial instruments                                  9       267           50
        9   Tax                                                                       415            -
    9 542   Cash and cash equivalents                                               2 765        1 927
       -    Non-current assets held for sale                                           -            63
   22 269   TOTAL ASSETS                                                           43 938      13 038
            EQUITY AND LIABILITIES
    6 952   TOTAL EQUITY                                                           14 027        6 358
    6 629   Equity attributable to shareholders of the parent                      13 982        6 045
      323   Non-controlling interests                                                  45          313
    1 918   Non-current liabilities                                        19 599        1 869
      623   Interest-bearing borrowings                                            16 315          676
      614   Operating lease accrual and fair value lease adjustment           8     2 106          483
      349   Post-retirement medical benefit liability                                 359          350
        -   Provisions                                                       282            -
        -   Derivative financial instruments                                  9        29            -
      332   Deferred tax                                                              508          360
   13 399   Current liabilities                                                    10 312        4 811
    4 625   Trade and other payables                                                8 407        3 997
      361   Provisions                                                                655          463
        -   Operating lease accrual and fair value lease adjustment           8        80            -
      185   Derivative financial instruments                                  9        52           14
      189   Tax                                                                       593          206
    8 039   Interest-bearing borrowings                                               525          131
   15 317   TOTAL LIABILITIES                                                      29 911        6 680
   22 269   TOTAL EQUITY AND LIABILITIES                                           43 938       13 038
     873    Net asset book value - per share (cents)                                1 507          796
            GROUP ANALYSIS
   22 269   Total assets                                                           43 938       13 038
    8 986   Woolworths*                                                            10 514        7 983
        -   David Jones                        27 763            -
    4 500   Country Road Group                                                      4 477        4 027
      794   Woolworths Financial Services                                             858          761
    7 989   Treasury - Cash and cash equivalents                                      326          267
    3 436   Inventories                                     5 676        3 229
    2 433   Woolworths*                                                             2 860        2 416
        -   David Jones                                                             1 746            -
    1 003   Country Road Group                                                      1 070          813
   15 317   Total liabilities                                                29 911        6 680
    4 871   Woolworths*                                                             5 987        4 658
        -   David Jones                                                             5 836            -
    2 355   Country Road Group                                                      1 833        2 022
    8 091   Treasury - Interest-bearing borrowings                                 16 255            -
   26 445   Approved capital commitments                                            2 303        1 228
    1 786   Woolworths*                                                               933          940
        -   David Jones                                                               718            -
      955   Country Road Group                                                        652          288
   21 604   Acquisition of David Jones                                                  -            -
    2 100   Acquisition of Country Road Group non-controlling interests                 -            -

*Includes Woolworths Clothing and General Merchandise, Woolworths Food and Woolworths Logistics.

INTERIM GROUP STATEMENT OF CASH FLOWS

 52 weeks                                                                                      26 weeks      26 weeks
to 29 Jun                                                                                     to 28 Dec     to 29 Dec
     2014                                                                                          2014          2013
       Rm                                                                              Notes        Rm            Rm
              Cash flow from operating activities
    5 375     Cash inflow from trading                                                            4 053         2 689
    (407)     Working capital movements                                                           (202)         (125)
    4 968     Cash generated by operating activities                                              3 851         2 564
      104     Interest income                                                                        84            25
    (106)     Finance costs paid                                                                  (625)          (37)
  (1 047)     Tax paid                                              (728)         (533)
    3 919     Cash generated by operations                                                        2 582         2 019
       95     Dividends received from joint ventures                                                 55            35
       62     Dividends received from associate    -            61
  (1 969)     Dividends to ordinary shareholders                                                (1 148)       (1 177)
    (103)     Dividends to preference shareholders                                                 (61)          (58)
    2 004     Net cash inflow from operating activities                                           1 428           880
              Cash flow from investing activities
              Net investment in property, plant and equipment, intangible assets and
  (1 314)     investment properties                                                             (1 110)         (520)
        -     Acquisition of subsidiary, net of cash acquired                              8   (21 447)             -
        -     Acquisition of non-controlling interests                                   13    (2 153)             -
    (396)     Acquisition of franchise operations                                          4       (68)          (10)
       18     Other                                                                                  38            17
  (1 692)     Net cash outflow from investing activities                                       (24 740)         (513)
              Cash flow from financing activities
     (71)     Settlement of share-based payments through share purchase                    5      (270)           (5)
      (1)     Share purchase costs                                                         5        (1)             -
        -     Rights issue proceeds                                                        5      9 984             -
     (46)     Finance lease payments                                                               (36)           (8)
       55     Long-term borrowings raised                                                        16 019             -
        -     Short-term borrowings raised                                                       11 282             -
     (94)     Borrowings repaid                                                                (11 870)             -
    (169)     Costs associated with debt and equity raising                                       (592)             -
    (326)     Net cash inflow/(outflow) from financing activities                                24 516          (13)
     (14)     Increase/(decrease) in cash and cash equivalents                           1 204           354
    1 582     Net cash and cash equivalents at the beginning of the period                        1 666         1 562
       98     Effect of foreign exchange rate changes                                             (105)            11
    1 666     Net cash and cash equivalents at the end of the period                              2 765         1 927
              GROUP ANALYSIS
    5 375     Cash inflow from trading                                                            4 053         2 689
    4 329     Woolworths                                                                          2 148         2 087
        -     David Jones                                                                         1 264             -
    1 046     Country Road Group                                                                    641           602
              Additions to property, plant and equipment, intangible assets
    1 939     and investment properties (gross)                                                  25 663           505
    1 552     Woolworths                                                                            632          428
        -     David Jones                                                                        24 750             -
      387     Country Road Group                                                                    281            77

INTERIM GROUP STATEMENT OF CHANGES IN EQUITY

    Total                                                                                         Total                                   Total
                                                                   Share-                                    Share-
 52 weeks                                                         holders           Non-       26 weeks     holders           Non-     26 weeks
to 29 Jun                                                          of the    controlling      to 28 Dec      of the    controlling    to 29 Dec
     2014                                                          parent      interests           2014      parent      interests         2013
       Rm                                        Notes                 Rm             Rm             Rm          Rm             Rm           Rm
             Shareholders' interest at    
    5 937    the beginning of the period                            6 629            323          6 952       5 637            285        5 922
             Movements for the period:    
    2 990    Profit for the period                                  1 645              2          1 647       1 505             62        1 567
     (11)    Other comprehensive income                             (587)              6     (581)          26             17           43
             Total comprehensive income for    
    2 979    the period                                             1 058              8          1 066       1 531             79        1 610
      246    Shares issued                           5              9 984              -          9 984         246              -          246
        -    Rights issue costs                      5              (399)              -          (399)          -               -            -
             Settlement of share-based    
             payments through share    
     (60)    purchase                                5              (270)              -          (270)         (5)              -          (5)
      (1)    Share purchase costs           5                (1)              -            (1)          -               -            -
             Settlement of share-based     
    (246)    payments through share issue            5                  -              -              -       (246)              -        (246)
      169    Share-based payments                                      57              -             57          66              -           66
  (2 072)    Dividends to shareholders                            (1 209)              -        (1 209)     (1 184)           (51)      (1 235)
             Acquisition of non-controlling    
        -    interests                                            (1 867)          (286)        (2 153)           -             -            -
             Shareholders' interest at the    
   6 952     end of the period                                     13 982             45         14 027       6 045            313        6 358
Restated                                                                                                                               Restated
   240.0     Dividend per ordinary share (cents)                                                   96.5                                    96.5
     1.4     Dividend cover (based on headline earnings)                                            1.9                                     1.9
   240.0     Dividend per preference share (cents)                                                 96.5                                    96.5
      

SEGMENTAL ANALYSIS
 
  52 weeks                                             26 weeks     26 weeks
 to 29 Jun                                                                     to 28 Dec    to 29 Dec
      2014                                                                          2014         2013         %
        Rm                                                          Notes             Rm           Rm     change
        Revenue              
    39 707    Turnover                                                            27 724       19 382       43.0
    11 505    Woolworths Clothing and General Merchandise                          6 218        5 756        8.0
    19 694    Woolworths Food                                                     10 836        9 498       14.1
       418    Woolworths Logistics                                                   219          214        2.3
         -    David Jones                                                          5 964            -          -
     8 090    Country Road Group                                                   4 487        3 914       14.6     
       237    Other revenue and investment income                                    736           72       amp;gt;100
        18    Woolworths Clothing and General Merchandise                              9            7       28.6
        73    Woolworths Food                                                         42           33       27.3
         -    David Jones                                                            666            -         -
        55    Country Road Group                                                     17           16        6.3
        91    Treasury                                                                76           16       amp;gt;100
         -    Intragroup                                               12           (74)            -         -    
    39 944    Total group                                                         28 460       19 454       46.3
              Gross profit              
     5 373    Woolworths Clothing and General Merchandise                          2 940        2 630       11.8
     4 983    Woolworths Food                                                      2 734        2 390       14.4
         -    David Jones                                                          2 938            -          -
     5 009    Country Road Group                                                   2 789        2 468       13.0
       133    Intragroup                                                              80           66       21.2
    15 498    Total group                                                         11 481        7 554       52.0
              Profit before tax-adjusted              
    2 029    Woolworths Clothing and General Merchandise                          1 095        1 066        2.7
     1 259    Woolworths Food                                                        728          586       24.2
       181    Woolworths Financial Services                                          119           88       35.2
         -    David Jones                       999            -          -
       891    Country Road Group                                                     549          471       16.6
        15    Treasury                                                             (610)            8     amp;lt;(100)
     4 375    Total group-adjusted                                                 2 880        2 219       29.8
     (271)    Adjustments                                                          (549)         (54)
     (182)    Transaction costs                                                    (260)            -
         -    Integration and restructuring costs                                   (47)            -
         -    Non-recurring finance costs                                          (164)            -
         -    Impairment of property, plant and equipment                          (114)            -
     (139)    Unrealised foreign exchange gains/(losses)                              36         (54)
        50    Profit on sale of investment properties                                  -            -             
     4 104    Profit before tax                                                    2 331        2 165        7.7

Notes
1. BASIS OF PREPARATION
   These interim Group financial statements comply with IAS 34 Interim Financial Reporting.

   Accounting policies used in the interim Group financial statements are consistent with the prior period,
   except for the changes in accounting policy disclosed in note 7, and are the same as those used to
   prepare the 29 June 2014 Group annual financial statements. They have been prepared in compliance
   with International Financial Reporting Standards (IFRS) and interpretations adopted by the International
   Accounting Standards Board (IASB), South African Institute of Chartered Accountants (SAICA), Financial
   Reporting Standards Committee (FRSC), and the Companies Act of South Africa. The interim Group
   financial statements have been prepared under the supervision of the Group's finance director,
   Reeza Isaacs, CA(SA) and are the full responsibility of the directors.

2. EARNINGS PER SHARE
   The difference between earnings per share and diluted earnings per share is due to the impact of
   unexercised options under the Group's share incentive schemes. The weighted average number of
   shares in issue and the earnings and dividend per share measures have been restated by a factor of
   1.0477 to reflect the bonus element of the rights issue as required by IAS 33: Earnings per share (refer to
   note 5).

3. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
   During the financial period, the Group acquired property, plant and equipment at a fair value of
   R11.4 billion (2013: R452 million) and acquired intangible assets (including goodwill and brands) at a fair
   value of R14.6 billion (2013: R71 million). This included acquisitions related to business combinations (refer
   to notes 4 and 8). An investment property amounting to R36 million was transferred to property, plant and
   equipment due to a change in use.

4. ACQUISITION OF FRANCHISE OPERATIONS
   During the period, the Group acquired five (2013: one) previously franchised stores in South Africa for a
   total purchase consideration of R39 million (2013: R10 million).
   
                                                              Dec 2014    Dec 2013
                                                                    Rm          Rm
   Fair value of assets acquired at the date of acquisition 
   Property, plant and equipment                                     4           -
   Reacquired rights                                                 7           2
   Deferred tax liability                                          (2)         (1)
   Goodwill arising on acquisition                                  30           9
   Consideration                                                    39          10
   Prior period amount paid                                         29           -
   Cash outflow                                                     68          10
   
   Goodwill of R30 million (2013: R9 million) represents the fair value of growth and synergies expected to
   accrue from the acquisitions that does not qualify for separate recognition.
   
   From the dates of the acquisitions, R21 million additional revenue and R6 million profit before tax has
   accrued. Had the acquisitions been effective from the beginning of the period, the directors consider
   that, on a pro-forma basis, the contribution to revenue and profit before tax for the 26 weeks ended
   28 December 2014 would have been a further R2 million and R1 million respectively.


5. ISSUE AND REPURCHASE OF SHARES
   During the period, 167 803 572 (2013: nil) shares totalling R9 984 million (2013: nil) were issued by way of a
   rights issue on 29 September 2014. Rights issue costs of R399 million (2013: nil) have been charged to equity.
  
   3 054 442 (2013: nil) ordinary shares at a net cost of R241 million (2013: nil) were purchased from the market
   and transferred to employees in terms of the Group's share incentive schemes. In the prior period,
   4 361 450 ordinary shares totalling R246 million were issued and allocated to employees.
  
   408 701 (2013: 125 799) ordinary shares totalling R30 million (2013: R8 million) were purchased from
   the market by Woolworths Proprietary Limited and are held as treasury shares by the Group.
   1 038 174 (2013: 1 114 674) ordinary shares totalling R22 million (2013: R63 million) were allocated to
   employees in terms of the Group's Restricted Share Plan.

6. RESTATEMENT OF COMPARATIVE FIGURES AND ADDITIONAL DISCLOSURE
   6.1 Earnings per share
       Earnings per share, dividend per share and other related share measures have been restated to
       reflect the bonus element arising from the rights offer (refer to notes 2 and 5).

   6.2 Turnover and concession sales
       Turnover and concession sales includes the sale of goods by concession operators. Turnover
       excludes concession sales on the basis that the inventory sold is owned by the concession
       operator at the time of sale. The Group's share of concession sales is recognised as other revenue
       at the time the sale is made.

7. CHANGE IN ACCOUNTING POLICY
   The adoption of certain new standards, which became effective in the current period, has resulted in
   minor changes to accounting policies and disclosure, none of which have a material impact on the
   financial position or performance of the Group.

8. ACQUISITION OF DAVID JONES LIMITED
   On 1 August 2014, Woolworths Holdings Limited ("WHL"), through its subsidiaries, Osiris Holdings
   Proprietary Limited and Vela Investments Proprietary Limited, acquired all of the ordinary shares of David
   Jones Limited ("David Jones") for a total value of A$2.1 billion (R21.4 billion).

   The acquisition was funded by cash of R10 billion, A$264 million (R2.5 billion) Australian senior debt and
   a R9.9 billion equity bridge loan. The equity bridge loan was repaid out of the proceeds of a rights offer
   completed on 2 October 2014.

   Assets acquired and liabilities assumed
   WHL has measured the identifiable assets and liabilities of David Jones at their acquisition-date fair values.
   The provisional values are presented below:
    
                                                      Rm     A$m      
    Non-current assets                            16 957   1 705      
    Property, plant and equipment                 10 205   1 026      
    Intangible assets                              6 042     607      
    Fair value lease adjustment                       88       9      
    Deferred tax                                     622      63      
    Current assets                                 2 533     254      
    Inventories                                    1 675     168      
    Trade and other receivables                      242      24      
    Tax                                              459      46      
    Cash and cash equivalents                        157      16      
    Non-current liabilities                        1 815     182      
    Fair value lease adjustment                    1 685     169      
    Provisions           130      13      
    Current liabilities                            4 489     451      
    Trade and other payables                       2 985     300      
    Provisions                                       234      23      
    Fair value lease adjustment                      134      14      
    Derivative financial instruments                   7       1      
    Interest-bearing borrowings                    1 129     113      
    Total identifiable net assets at fair value   13 186   1 326      
    Goodwill arising from acquisition              8 418     823      
    Purchase consideration                        21 604   2 149      
    Purchase consideration transferred            21 383   2 149      
    Cost of hedging instrument                       221       -      
    Cash and cash equivalents acquired             (157)    (16)      
    Cash outflow on acquisition                   21 447   2 133      


   Goodwill of A$823 million (R8.4 billion) and the David Jones brand amounting to A$584 million
   (R5.8 billion) have been recognised on the acquisition. Goodwill represents the value paid in excess of
   the provisional fair value of net assets and consists largely of synergies and economies of scale expected
   from strategic initiatives. Transaction costs of R245 million have been expensed in the current period.
   
   As a result of the acquisition, leases were determined to be either favourable or unfavourable in
   comparison to market-related rentals, and accordingly, have been disclosed separately as assets or
   liabilities on the statement of financial position. Included in the operating lease accrual and fair value
   lease adjustment are R1 599 million non-current liabilities and R74 million current liabilities. These will
   unwind over the duration of the leases through the statement of comprehensive income.
   
   The fair values are provisional and subject to further review for a period of up to one year from the
   acquisition date, and as a result, not all of the required disclosures are contained herein. The Australian
   dollar values have been translated at the closing exchange rate at 1 August 2014 of A$1: R9.95.

9. FAIR VALUE OF FINANCIAL INSTRUMENTS
   The carrying value less impairment provision of trade and other receivables and trade and other
   payables are assumed to approximate their fair values due to their short-term nature.

   In terms of IFRS 13: Fair value measurement, the Group's derivative financial instruments are measured
   using level two with inputs that are observable for the asset or liability, either directly or indirectly. The
   carrying amounts of these derivative financial instruments approximate their fair value.

10.CONTINGENT LIABILITIES
   Group companies are party to legal disputes and investigations that have arisen in the ordinary course
   of business. Whilst the outcome of these matters cannot readily be foreseen, the directors do not expect
   them to have any material financial effect.

11.BORROWING FACILITIES
   Unutilised banking facilities amount to R5 174 million (2013: R2 659 million). There is no limit imposed by the
   Memorandum of Incorporation on the Group's authority to raise interest-bearing debt.

12.RELATED PARTY TRANSACTIONS
   During the period the Group entered into related party transactions, the substance of which are similar
   to those explained in the Group's 2014 annual financial statements. Intercompany transactions have
   further arisen in the current period between the Country Road Group and David Jones.

13.ACQUISITION OF NON-CONTROLLING INTERESTS
   13.1  Country Road Limited
         The Group acquired the remaining 12.12% shares in Country Road Limited ("Country Road") for a cash
         consideration of A$213 million (R2.1 billion). As a wholly-owned subsidiary within the Group, Country
         Road was delisted from the Australian Securities Exchange (ASX). Given its role in realising a substantial
         part of the synergy benefits arising from the acquisition of David Jones, achieving full ownership of
         Country Road was a logical next step and in line with the Group's longstanding desire to acquire
         100% ownership. The acquisition was funded through new debt facilities raised from Australian banks.

         The excess of the purchase price over the carrying value of the related non-controlling interests in
         Country Road totalling R1.9 billion has been charged to equity.

   13.2  Woolies (Zambia) Limited
         On 29 July 2014, WHL concluded terms to acquire the remaining 49% shareholding in Woolies (Zambia)
         Limited not already owned by the WHL Group for a total cash consideration of R29 million.

14.APPROVAL OF INTERIM GROUP FINANCIAL STATEMENTS
   The interim Group financial statements were approved by the Board of directors on 11 February 2015.

15.AUDIT OPINION
   These interim Group financial statements have not been reviewed or audited.

   DIRECTORATE AND STATUTORY INFORMATION
   Non-executive directors:
   Simon Susman (Chairman), Patrick Allaway (Australian), Peter Bacon (British), Zarina Bassa,
   Tom Boardman (Lead independent director), Hubert Brody, Andrew Higginson (British), Mike Leeming,
   Nombulelo Moholi, Stuart Rose (British), Thina Siwendu
 
   Executive directors:
   Ian Moir (Group chief executive officer) (Australian), Reeza Isaacs, Sam Ngumeni, Zyda Rylands
 
   Group secretary:
   Thobeka Sishuba-Mashego

   Registered address:
   Woolworths House, 93 Longmarket Street, Cape Town, 8001
   PO Box 680, Cape Town, 8000

   JSE sponsor:
   RAND MERCHANT BANK (A division of FirstRand Bank Limited)

   Transfer secretaries:
   Computershare Investor Services Proprietary Limited
   70 Marshall Street, Johannesburg, 2001





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