Big W has posted $50 million in profit for the 27 weeks ended 5 January 2020 – a turnaround from an $8 million loss in first half FY19 and the retailer’s first profit since FY16.
Sales were up 2.8% on the prior year and comparable sales increased 3.7% driven by apparel, toys, home and everyday needs. Q2 sales were adversely impacted by the performance of the three stores scheduled for closure in January, the exit of the optical category and slowdown in gaming and console sales.
While transaction growth in Q2 was lower than recent trends, there was a significant reduction in clearance activity compared to the prior year. Customer trading patterns also shifted further during the half with a strong Black Friday and more subdued lead up to Christmas.
Online sales increased by 23.3% for the half and 24.4% in Q2 driven by pick-up and supported by initiatives including Digi Sales, Click Frenzy and Black Friday.
Big W store numbers remained unchanged at 183 stores during the half. Three stores were closed in January as part of the previously announced network review.
Woolworths group CEO, Brad Banducci said, “We have been encouraged by Big W’s improved trading performance in the half. In the second half, Big W will continue to focus on profitable sales growth, and we expect to continue to build on our current foundation. Profit in the second half is typically lower than the first half reflecting the seasonality of the business; however, we expect to report a profit for the full year.”