Woolworths 1H adj diluted EPS 1.703 rand, est. 1.71 rand

Woolworths 1H adj diluted EPS 1.703 rand, est. 1.71 rand

Woolworths Holdings Reports 1H FY2025 Adjusted Diluted EPS Below Estimates
Woolworths Holdings (JSE: WHL), South Africa's leading retail group, reported adjusted diluted earnings per share (EPS) of 1.703 rand for the first half of fiscal 2025, narrowly missing the estimated 1.71 rand. The result reflects mixed performance across its segments, with group sales rising 5.7% year-over-year to ZAR40.3 billion, driven by 11.4% growth in its Food division. However, adjusted EBIT declined 13.7%, primarily due to weaker performance in its Apparel segment.

The company's full-year FY2025 results, released earlier, showed revenue of R79.5 billion (a 3.9% increase from FY2024) but net income fell 5.8% to R2.44 billion, with profit margins contracting to 3.1% from 3.4%. Higher operating expenses, particularly General & Administrative costs (R14.7 billion, or 59% of total expenses), further pressured profitability.

Management reiterated its commitment to margin targets, noting that strategic investments—such as digital transformation and supply chain optimization—are expected to yield measurable benefits starting in FY2026. Despite the near-miss in 1H EPS, Woolworths Holdings' Food segment remains a key growth driver, contributing 64% of total revenue in the full year.

Looking ahead, the company faces a challenging operating environment, with analysts forecasting revenue growth of 6.8% annually over the next three years, below the 9.8% industry average for global multiline retailers. Risks include elevated debt levels and liquidity constraints, as highlighted by a debt-to-equity ratio of 3.58 and a current ratio of 0.57.

Investors will be watching closely as Woolworths Holdings navigates margin pressures and executes its strategic initiatives to restore growth momentum.

According to Yahoo Finance: Yahoo Finance, as reported by Financial Modeling Prep: Financial Modeling Prep, via Yahoo Scout: Yahoo Scout.