Woolworths Limited released its quarterly sales results today, which show that the company’s consumer electronics division saw losses in Australia and New Zealand.
For the 14-week period ending 2 October 2011, Australian sales were down 2.1 per cent to $326 million, while New Zealand sales were down 6 per cent (when measured in Australian dollars) to $63 million.
Overall, the Woolworths’ CE division saw sales rise by 0.8 per cent – with the poor performance of Australia and New Zealand bolstered by an 18.5 per cent increase in sales figures for the Indian market. Indian sales reached the $96 million mark for the past quarter, a figure that outstripped New Zealand’s sales by $33 million.
Speaking about the results, Woolworths Limited CEO said, “It was a solid start to the year considering retail conditions remain challenging.
“The retail sector continues to be impacted by a lack of consumer confidence which means we have to work harder for every dollar.”
Conditions may be tough but Woolworths Limited’s general manager of consumer electronics, Debra Singh, noted that the company was finding success through the changing of its store format.
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“Whilst the business is in transition, the new format stores, which are now 71 per cent of the total store network, are outperforming older format stores and achieved sales growth of 4.2 per cent,” said Singh.
“51 per cent of the store network is now the optimal size new concept format,” she added. “These stores delivered strong comparable sales growth of 5.2 per cent this quarter.” After opening 7 stores and closing 14 this quarter, Woolworths now has 320 consumer electronics stores in Australia.
“Consumer Electronics Australia sales decreased 2.1 per cent with comparable store sales decreasing 0.5 per cent. Whilst slightly negative, this is a reasonable performance relative to the sector.
“Consumer Electronics continues to be impacted by the current economic conditions, continued high level of price competition across the sector and price deflation in key products, exacerbated by the strong Australian dollar.
“Our Consumer Electronics multichannel offer continues to display strong growth in customers and sales. We were pleased to be recognised by the Online Retail Industry Association as the Best Multi Channel Retailer and Online Retailer of the year for 2011.”
Also in the Woolworths stable is Masters – the new big-box hardware store that is set to challenge Bunnings for dominance in the sector.
According to a Woolworths spokesperson, Home Improvement sales increased 6.2 percent in the quarter, up to $188 million. “The result includes sales from the first Masters store which opened on 1 September 2011 and has exceeded our expectations in its first month of trade.”