Trading conditions squeeze Woolworths’ growth hopes
Increasingly difficult macro climate in SA and Australasia damps investor expectations of retail group
Investors are lowering their expectations for Woolworths as the outlook for the local retail sector deteriorates. The company’s share price, which has been pummelled, losing 27% over the past year, rose nearly 2% on Friday despite a lukewarm trading update and statement. The retailer’s sales were "more or less" in line with consensus, while the earnings guidance was slightly below expectations, said Sanlam Private Wealth investment analyst Renier de Bruyn. Woolworths said adjusted headline earnings per share for the year to June 25 would fall between 5% and 10%. Hopes had been for a rise in adjusted headline earnings per share of 5%. "Woolworths’ share price has been under pressure over the past three months so the market has already dampened expectations for the group given the tough macro environment," said De Bruyn. "I think the market was bracing for the softer numbers, given the weak national apparel retail sales numbers released in both SA and Australia over the past few month...
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