Woolworths Holdings Ltd (WHL) today announced results for the 26 weeks to 25 December 2016. Despite difficult trading conditions in both South Africa and Australia, Group sales increased by 6.7% to R37.8 billion, and profit before tax increased 37.9% following the sale by David Jones of its Market Street property in Sydney for a profit of A$172 million (R1762 million). Adjusted diluted headline earnings per share (adHEPS) declined by 2.4% to 244.9cps.

Woolworths Clothing and General Merchandise sales grew by 3.5%, a good result in a tough and promotional market. Price movement was held to 7.3%, despite the impact of a weaker rand on imported product. Comparable sales grew by 1.2%, indicating gains in market share.

Woolworths Food sales grew by 9.5%, with comparable sales up by 5.6%. Price movement at 9.2% remains high due to the impact of the drought. We invested in price through the period and continue to grow ahead of the market.

David Jones’ growth was affected by the timing of the Boxing Day sale, which falls into the second half of this financial year, as well as last year’s termination of the Dick Smith electronics concession. Adjusting for this, sales were 4.0% higher than the prior period, with comparable sales growth of 0.5% in Australian dollar terms. Adjusted profit before tax increased by 2.9% to A$105 million.

Country Road Group sales were also negatively impacted by the timing of the Boxing Day sale, though positively by the acquisition of Politix in November 2016. Adjusting for both, sales were 0.9% lower than the prior period in Australian dollar terms with sales performance impacted by intense promotional activity in the market.

Commenting on the results, WHL Chief Executive Ian Moir said:

“This is a good set of results in challenging trading conditions, and we have continued to grow the top line in a very competitive pricing environment. With the ongoing transformation of David Jones, some encouraging signs in Country Road and the continued success of our food and clothing offer in South Africa, we are confident of maintaining our position as the leading Southern Hemisphere retailer.”