Supermarket giant Woolworths has laid the blame for a dramatic drop in profits on warehouse workers who went on strike last year.
The Woolworths Group’s half year profit announcement on Wednesday revealed it had suffered a surprise $190million loss, declining almost 21 per cent to $739million for the six months to January 5.
Chief executive Amanda Bardwell called it a ‘challenging half which was impacted by industrial action and ongoing cost-of-living pressures’.
The report comes as the supermarket giant fights to improve its reputation among Australians.
The ACCC decided to separately sue Coles and Woolworths in September 2024, alleging that both deceived customers with hundreds of ‘sale’ prices for more than a year up to May 2023.
The commission is also holding an inquiry, ordered by the federal government, to look into the pricing practices of the supermarkets.
Bardwell, who has been at the helm of Woolworths since September, addressed the inquiry in her statement on the group’s profits.
‘We have assisted the ACCC throughout its inquiry and will carefully review the [completed] report.’
Woolworths Group, one of two major supermarkets in Australia, saw a drop in profits of $190million. It gave a submission to the ACCC Supermarkets Inquiry in November 2024 asserting the ‘fierce competition in grocery retailing’
The half year report, published on the ASX, also revealed earnings before interest and tax fell 14.2 per cent to $1.45 billion for the six months to January 5.
‘Our day-to-day experience is that the Australian grocery sector is highly competitive, and that customers have many choices about where to shop,’ Bardwell said.
‘We understand that despite low and stable food inflation, cost-of-living concerns persist for customers.’
She said Woolworths, one of only two major supermarket giants in the country, has seen profits drop because they were unable to fill shelves.
‘The team has worked incredibly hard to recover from the supply chain disruptions caused by industrial action in November and December.
‘In Victoria, sales have not yet fully recovered but availability and customer metrics are returning to pre-disruption levels with ongoing efforts to regain customers.
‘While we acknowledge the material impact of the industrial action… we came to an agreement that is fair and sustainable and enables ongoing productivity improvements critical to maintaining competitiveness.’
Workers across three Woolworths warehouses in Victoria and one in NSW went on strike for over two weeks in November and December 2024.
When an agreement with striking workers was reached in December 2024, CEO Amanda Bardwell (pictured) said ‘turning back on’ the supply chain would be gradual
Some setup picket lines blocking temporary workers and supply trucks effectively holding the supermarket to ransom.
The industrial action saw thousands of supermarket and bottle shop shelves in Victoria, NSW and the ACT sit empty.
It directly cost the supermarket chain at least $50 million.
New terms and conditions, as well as a competitive wage, were agreed between the supermarket and workers at four distribution centres on December 8.
