Woolworths Ltd., 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 fell 0.2 percent to A$29.09 at the close in Sydney. The stock has gained 16 percent this year compared with a 12 percent rise in the benchmark S&P/ASX 200 index.