Woolworths First-Quarter Sales Rise at Fastest Pace Since 2009

Woolworths Ltd. (WOW), Australia’s largest retailer, posted the fastest first-quarter sales growth from supermarkets open at least a year since 2009 as promotions and food price inflation drove growth.

Same-store food and liquor revenue rose 2.3 percent in the three months ended September, Sydney-based Woolworths said in a statement today. That is the fastest pace since the company reported 5.8 percent growth in the first quarter of 2009.

Growth in the quarter was helped by a return of food price inflation, after three consecutive quarters of declining prices. Woolworths has also used the opening of new stores to drive total sales, which rose 4.3 percent to A$15.2 billion ($15.8 billion) in the quarter, amid weak consumer spending driven by sentiment that’s had a negative reading for at least the past six months.

“Woolworths has enjoyed underlying improvement,” Michael Simotas, a Sydney-based analyst at Deutsche Bank AG, wrote in an Oct. 16 note to clients.

Woolworths shares rose 0.1 percent to A$29.18 at 10:49 a.m. in Sydney. The stock has gained 16 percent this year compared with a 13 percent rise in the benchmark S&P/ASX 200 index.

To contact the reporter on this story: David Fickling in Sydney at dfickling@bloomberg.net

To contact the editor responsible for this story: Stephanie Wong at swong139@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.