Woolworths Holdings has issued a trading statement indicating a significant drop in expected earnings for the year ending June. The retailer anticipates a decline of up to 27% in headline earnings per share (HEPS), a crucial profit metric that excludes certain one-off items. This translates to a HEPS range of 257.2c to 274.8c per share, a substantial decrease from the previous 352.3c.
Why the Drop?
The primary drivers behind this expected earnings slump are the continued underperformance of its Australian Country Road Group (CRG) and the impact of non-cash impairments. CRG has been struggling, and this is now significantly impacting the overall financial performance of Woolworths Holdings.
What does this mean for shoppers?
While the trading statement focuses on financial performance, it raises questions about potential impacts on consumers. Will this lead to price increases, store closures, or changes in product offerings? It remains to be seen how Woolworths will navigate these challenges and what strategies they will implement to address the underperformance of CRG and improve overall profitability.
Investors and shoppers alike will be watching closely to see how Woolworths responds to this challenging period.