Woolworths has reported a better-than-expected half-year profit and upgraded its full-year earnings guidance.
The supermarket and retail giant reported net earnings for the 27 weeks to January 5 of $1.32 billion.
That was an increase of 14.5 per cent compared to the same period a year earlier.
Woolworths’s chief executive officer Grant O’Brien says the company’s full-year net profit is set to increase by 5 to 7 per cent, bettering earlier predictions of a 4 to 7 per cent growth range.
“Our focus over the last two years has been to transform the Woolworths business. This result demonstrates, I think, that we’re on the right path,” he said.
“Our sales and profit results reflects what we said we would do, and is both in line with our guidance and our previous commentary.”
The Woolworths boss says, while the retailer experienced a post-election spike in consumer confidence, recent job cut announcements and the coming budget could weigh on sentiment.
Mr O’Brien says he is realistic about the challenges that lie ahead for Australian consumers.
“There’s a (federal) budget coming our way, and there’s also quite a bit of negative noise around jobs, whether it be the car manufacturing sector or whether it be the travel sector,” he cautioned.
“So it’s just something that we’ll watch for. Generally food and liquor roll along and are not as affected by that sort of sentiment as the discretionary space is.”