Woolworths Group Ltd · ASX:WOW
Woolworths — FY2024 Earnings Presentation
52 slides from Woolworths's earnings presentation, Aug 28, 2024
Slide 1: Full Year Results Presentation
28 August 2024 ASX Market Announcements Office Australian Securities Exchange 20 Bridge Street Sydney NSW 2000 Full Year Results Presentation Attached for release to the market is the Full Year Results Presentation for the period ended 30 June 2024. Authorised by: Dom Millgate, Group Company Secreta
Slide 2: Woolworths Group 2024 Full Year Results
Woolworths Group 2024 Full Year Results For the 53 weeks ended 30 June 2024 Brad Banducci, Managing Director and CEO Amanda Bardwell, CEO-elect Stephen Harrison, CFO 28 August 2024 1
Slide 3: Acknowledgement of Country
Acknowledgement of Country Woolworths Group acknowledges the many Traditional Owners of the lands on which we operate and pay our respects to their Elders past and present. We recognise their strengths and enduring connection to lands, waters and skies as the Custodians of the oldest continuing cult
Slide 4: Contents
Woolworths Group Full Year Results 2024 3 Contents F24 Group summary and progress 4 Brad Banducci & Amanda Bardwell Group financial results and capital management 22 Stephen Harrison Current trading and outlook 32 Brad Banducci & Amanda Bardwell We create better experiences together for a better tom
Slide 5: F24 summary
Woolworths Group Full Year Results 2024 4 F24 summary Working hard to help our Customers Challenging year with rapidly changing customer expectations. Focus on value, shelf availability and convenience with Customer metrics improving and items returning to growth in Q4 Customer Care remains a highli
Slide 6: Cost-of-living pressures driving grocery value-seeking behaviours
Woolworths Group Full Year Results 2024 5 Housing driven cost-of-living pressures continuing to drive grocery value-seeking behaviours; younger singles and couples most impacted Percentage of Customers1 using ‘Ways to Save’ (% ) Share of Australian household spending by major Share of Australian spe
Slide 7: Inflation has moderated significantly in H2
Woolworths Group Full Year Results 2024 6 Inflation has moderated significantly in H2 with Food declining as a proportion of household spend Share of average Australian Household Total Woolworths Food Retail Average Price Change Typical Woolworths Trolley2 Expenditure on Food1 (% yoy) Food % of tota
Slide 8: Customer metrics in Food recovering after dip in Q3
Woolworths Group Full Year Results 2024 7 Customer metrics in Food recovering after dip in Q3; Value for Money remains biggest opportunity Customer VOC NPS Store-controllable customer scores VOC NPS customer scores1 Woolworths Food Retail Group VOC NPS Care Availability Value for Money New Zealand F
Slide 9: Rebuilding momentum in Australian Food after challenging Q3
Woolworths Group Full Year Results 2024 8 Rebuilding momentum in Australian Food after challenging Q3 Woolworths Food Retail sales growth (% yoy) 6.1 Solid F24 sales growth but material 4.3 slowdown in H2 driven by lower 1.5 1.9 inflation and item growth. Improvement in Q4 driven by items Q1 F24 Q2
Slide 10: Working hard to provide value for our Customers
Woolworths Group Full Year Results 2024 9 Working hard to provide value for our Customers Find value 12% ~30% Reset of Everyday Low Price; launch of Lower Shelf Price. Clearer value growth in Macro sales with 9% Average saving on Own Brand communication including Unit Prices volume growth. Odd Bunch
Slide 11: Progress on New Zealand Food and BIG W transformations
Woolworths Group Full Year Results 2024 10 Progress on New Zealand Food and BIG W transformations, but more to do… • Reset of price mechanics (Value for Money • Health & Beauty shop in shops now in 45 stores with Brand and customer scores: +5 pts vs June 23) Customer strong customer resonance; plans
Slide 12: Our Group Everyday Retail Strategy
Woolworths Group Full Year Results 2024 11 Our Group Everyday Retail Strategy Woolworths Retail W Living Our cornerstone B2C retail Meeting more of our customers food businesses, famous for everyday needs with real value, good food, good prices, good real solutions and real care acts and always conv
Slide 13: Digital visits now exceeding store visits
Woolworths Group Full Year Results 2024 12 Digital visits now exceeding store visits with tools enhancing shopping experiences for connected Customers Digital visits exceeding store visits since June 2023 Average weekly digital visits vs. in-store transactions (million) 3.7m 20% Weekly active Increa
Slide 14: Connected Members accessing more value through Everyday Rewards
Woolworths Group Full Year Results 2024 13 Connected Members accessing more value through Everyday Rewards Steady growth for active EDR members Australian active members1 and scan2 and tag rates3 Active members (million) Scan rate (%) (RHS) Tag rate (%) (RHS) 9.8m 1.6m Active AU EDR Active NZ EDR m
Slide 15: Ongoing strength in eCom driven by Same Day
Woolworths Group Full Year Results 2024 14 Ongoing strength in eCom driven by Same Day; material improvement in profit with DAP margin over 3% in F24 Strong growth in eCom Sales and DAP Group eCom sales and eComX DAP Driven by growth in convenience propositions $b $m 86% 727 8 Other Group eCom sales
Slide 16: Retail Platforms strengthening capabilities across the Group
Woolworths Group Full Year Results 2024 15 Retail Platforms strengthening capabilities across the Group Value created Value back to the Group The Group’s primary freight Supporting over 1,300 services extended to third party supplier relationships via customers (PC+) with revenue of PC+ and driving
Slide 17: NSW supply chain transformation progressing to plan
Woolworths Group Full Year Results 2024 16 NSW supply chain transformation progressing to plan with MSRDC the blueprint for Moorebank Melbourne South Regional DC Moorebank National DC Moorebank Regional DC Auburn CFC 57,000 sqm automated site; fast-moving 40,500 sqm semi-automated site; 55,600 sqm a
Slide 18: Rapid growth from Cartology over last five years
Woolworths Group Full Year Results 2024 17 Rapid growth from Cartology over last five years; evolving to capture next phase of growth Cartology Revenue ($m)1 Owned and operated channels • Over 5,000 campaigns in F24 across Supermarkets and BIG W 34% • Health and beauty screens launched in ~400 4-yr
Slide 19: wiq delivering material value with a strong pipeline
Woolworths Group Full Year Results 2024 18 wiq delivering material value with a strong pipeline Scale analytics platforms to Quick Assist 50+ use cases in F24 with benefits deliver exceptional impact Transforming how team uses across buying & promotions, for customers and teams customer & team exper
Slide 20: Meeting more Customer needs through Woolworths Food Company
Woolworths Group Full Year Results 2024 19 Meeting more Customer needs through Woolworths Food Company Value created Value back to the Group Macro #1 Health & New convenient meal Sustainability brand in ranges for Metro & Australia with sales up Supermarkets 12% from F23 (Fresh to Go, For Tonight, M
Slide 21: Solid progress across our Sustainability pillars in F24
Woolworths Group Full Year Results 2024 20 Solid progress across our Sustainability pillars in F24 1.44 13.86 681 $143.4m Launched People Group Severity Total Recordable Injury mini woolies of direct community Woolworths Group Rate Frequency Rate opened since contributions in F24 Foundation to help
Slide 22: Contents
Woolworths Group Full Year Results 2024 21 Contents F24 Group summary and progress 4 Brad Banducci & Amanda Bardwell Group financial results and capital management Stephen Harrison Group financial results Key balance sheet metrics 22 Capital management framework Cash flow summary Capital expenditure
Slide 23: Group financial results and capital management
Woolworths Group Full Year Results 2024 22 Group financial results and capital management
Slide 24: F24 results summary
Woolworths Group Full Year Results 2024 23 F24 results summary F24 Group sales F24 Group EBIT ($ million) 3.7% ($ million) 1.1% normalised 67,922 normalised vs. F23 3,223 3,116 vs. F23 64,294 H2 F24 H2 F24 3.0% 1.3% F24 F23 normalised F24 F23 normalised vs. H2 F23 vs. H2 F23 Group NPAT1 Grou
Slide 25: Group trading performance
Woolworths Group Full Year Results 2024 24 Group trading performance Group sales and EBIT H2 F24 F24 NORMALISED NORMALISED NORMALISED NORMALISED $ MILLION H2 F24 SALES CHANGE CHANGE1 H2 F24 EBIT CHANGE CHANGE1 F24 SALES CHANGE CHANGE1 F24 EBIT CHANGE CHANGE1 Before significant items Australian Food
Slide 26: Higher end-to-end efficiency and productivity delivered in F24
Woolworths Group Full Year Results 2024 25 Higher end-to-end efficiency and productivity delivered in F24; strong pipeline for F25 Key productivity initiatives Productivity examples Stores Simplified inventory routines Electronic Shelf Labels, Front of Store upgrades Stockloss including Scan Assist
Slide 27: Average inventory marginally up; underlying ROFE largely in line
Woolworths Group Full Year Results 2024 26 Average inventory marginally up reflecting investment to improve availability; underlying ROFE largely in line with prior year Average inventory and payables days1 Inventory Payables • Average inventory up 0.3 days • Increased inventory holdings, particular
Slide 28: Woolworths Group capital management framework
Woolworths Group Full Year Results 2024 27 Woolworths Group capital management framework Strong growth One of Australia’s Leading market Defensive opportunities in Strong underlying most trusted position in Food & characteristics eCom and cash flow brands Everyday Needs through the cycle Investment
Slide 29: Cash flow
Woolworths Group Full Year Results 2024 28 Cash flow F24 F23 $ MILLION 53 WEEKS 52 WEEKS CHANGE Group EBITDA before significant items 6,001 5,694 5.4% Net working capital outflow due to higher net investment in Working capital and non-cash movements (138) 322 n.m. inventory and impact of 53rd week o
Slide 30: Operating capex largely in line with prior year
Woolworths Group Full Year Results 2024 29 Operating capex largely in line with prior year; increased spend on renewals and supply chain Sustaining capex $ MILLION F24 F23 $ MILLION F24 F23 1,551 1,371 SIB 344 317 Sustaining capex Renewals 435 364 Growth capex 460 517 Supply chain 311 254 Operating
Slide 31: Dividends and funding
Woolworths Group Full Year Results 2024 30 Dividends and funding 57 cps final dividend & 40 cps special dividend Debt maturity profile ($m)1 Dividends (cents per share) 1,200 Capital markets debt Bank debt - drawn 144 40 104 800 92 58 57 53 400 104 39 46 47 - F22 F23 F24 F25 F26 F27 F28 F29 F30 F31
Slide 32: Contents
Woolworths Group Full Year Results 2024 31 Contents F24 Group summary and progress 4 Brad Banducci & Amanda Bardwell Group financial results and capital management 22 Stephen Harrison Current trading and outlook 32 Brad Banducci & Amanda Bardwell
Slide 33: Current trading and outlook
Woolworths Group Full Year Results 2024 32 Current trading and outlook Outlook remains challenging but improved trading momentum to start the year Sales momentum in F25 has continued to improve across the Group in line with improving Customer scores Australian Food sales for the first 8 weeks up ~3%
Slide 34: CEO transition: Reconnecting, listening and learning
33 CEO transition: Reconnecting, listening and learning • Together with Brad and the leadership team, shaped our F25 Group and business strategies • Listening to our customers I’ve had the opportunity over the last few months to • Spent time with our teams in-store, distribution centres work with an
Slide 35: CEO transition: F25 focus areas
Woolworths Group Full Year Results 2024 34 CEO transition: F25 focus areas Activate our trade Simplify how plans, delivering we work, consistently and make it easier to on retail have an impact fundamentals Continue to scale Retail platforms, Get it right, unlocking the Enable our Team for our Custo
Slide 36: Q&A
Woolworths Group Full Year Results 2024 Q&A 35
Slide 37: Some things never change
Woolworths Group Full Year Results 2024 Some things never change 36
Slide 38: Woolworths Group Full Year Results 2024
Woolworths Group Full Year Results 2024 37
Slide 39: Australian Food
Woolworths Group Full Year Results 2024 38 Australian Food F24 F23 53 WEEKS 52 WEEKS CHANGE CHANGE NORMALISED1 Total sales ($m) 50,741 48,047 5.6% 3.7% EBITDA ($m) 5,006 4,651 7.6% 5.8% EBIT ($m) 3,110 2,865 8.6% 6.0% Gross margin (%) 28.9 28.1 76 bps 76 bps CODB (%) 22.7 22.1 59 bps 62 bps EBIT to
Slide 40: Australian Food – Woolworths Food Retail
Woolworths Group Full Year Results 2024 39 Australian Food – Woolworths Food Retail Build advocacy for Today’s Fresh Food People SALES PERFORMANCE BY BUSINESS ($m) • Invested in team safety initiatives, including virtual reality safety training for 45,000 team members and other safety initiatives F2
Slide 41: Australian Food - WooliesX
Woolworths Group Full Year Results 2024 40 Australian Food - WooliesX eComX SALES PERFORMANCE BY PLATFORM ($m) • 1m+ active B2C eCom customers in June 24 • 86% of orders fulfilled within 24 hours, up 6 points vs. F23 F24 F23 Change 53 WEEKS 52 WEEKS Change normalised1 • Launched Direct to Boot Now,
Slide 42: Australian Food F25 outlook
Australian Food F25 outlook In F25, we will continue to bring a little good to everyone, every day across three main areas Act with Purpose for a better and Deliver consistently great customer Build consistently great team safer today experiences experiences and retail foundations Maintain a laser f
Slide 43: Australian B2B
Woolworths Group Half-Year Results 2024 42 Australian B2B
Slide 44: Australian B2B
Woolworths Group Full Year Results 2024 43 Australian B2B B2B Food SALES PERFORMANCE BY BUSINESS ($m) SALES PERFORMANCE BY BUSINESS ($m) • Resilient PFD sales growth due to diversified and growing customer base F24 F23 Change • Woolworths Food Company Retail achieved 183 53 WEEKS 52 WEEKS Change nor
Slide 45: Woolworths Group Full Year Results 2024
Woolworths Group Full Year Results 2024 44
Slide 46: New Zealand Food
Woolworths Group Full Year Results 2024 45 New Zealand Food Living our purpose and transforming our brand SALES PERFORMANCE BY BUSINESS ($m)1 • 72 stores rebranded to Woolworths New Zealand and eight renewals completed in F24 F24 F23 Change • Launched new brand platform, That Fresh Food Feeling, inc
Slide 47: Woolworths Group Full Year Results 2024
Woolworths Group Full Year Results 2024 46
Slide 48: BIG W
Woolworths Group Full Year Results 2024 47 BIG W Customer and team first SALES PERFORMANCE BY BUSINESS ($m) • Rolled out new Health & Beauty shop-in-shop format to 45 stores • Trialled new store format in Stanhope Gardens, Sydney • Continued progress on multi-skilling with 99% of team members traine
Slide 49: Glossary
Woolworths Group Full Year Results 2024 48 Glossary Active eCom customers Customers that have made a purchase online in the last four weeks AGW Australian Grocery Wholesalers Pty Limited AI Artificial intelligence B2B Business to business B2C Business to customer CAGR Compound annual growth rate Cas
Slide 50: Glossary continued
Woolworths Group Full Year Results 2024 49 Glossary continued PC+ Primary Connect third-party logistics Pick up A service which enables collection of online shopping orders at a store or at select locations Renewal A total store transformation focused on the overall store environment, team, range an
Slide 51: Glossary continued
Woolworths Group Full Year Results 2024 50 Glossary continued Other non-IFRS measures used in describing the business performance include: • Earnings before interest, tax, depreciation and amortisation (EBITDA) • Change in average prices • Cash flow from operating activities before interest and tax
Slide 52: Disclaimer
Woolworths Group Full Year Results 2024 51 Disclaimer This presentation contains summary information about Woolworths Group Limited (Woolworths Group) and its activities current a s at the date of this presentation. It is sourced from and should be read in conjunction with Woolworths’ other periodic