Woolworths food sales make up for weaker clothing. The retailer says after a smaller winter sales affected first-quarter sales,

womenswear, in particular, showed signs of life in October.

Woolworths expects a big improvement in first-half earnings after last year's

profit was high by a big impairment of its investment in Australian department

store chain David Jones.

In a trading statement yesterday, the upmarket retailer said earnings per

share for the 26 weeks to 24 December were likely to be more than double what

it reported last year and would be more than 150% higher than the 369.5c per

share loss it reported for the 52 weeks to 24 June 2018. It impaired the

carrying value of David Jones by close to R7 billion last year.

It said it would provide guidance on headline earnings once it had more

certainty on the ranges expected for the half-year.

In a trading update, Woolworths said sales increased by 2.7% in the 20 weeks

to 12 November and were 3.6% higher on a constant currency basis. While

Fashion, Beauty and Home sales declined by 3.3%, Food sales rose 7.2%, with

comparable store sales up 5%. It said a smaller winter sale affected first-

quarter sales but womenswear in particular improved in October. Food sales

benefited from higher levels of promotion.

In Australia, sales momentum at David Jones continued into the new financial

year, rising by 2.9% and by 2.4% on a comparable stores basis. Online sales

jumped 48.4% and now contribute 5.2% of total sales. Country Road sales

increased by 3.4% and by 0.5% in comparable stores.

Woolworths' shares declined 0.3% to 53.53 rand yesterday.

Terrible trading update from Woolworths. Turnaround seems far away.

-- Dave Hazelwood (@hazelwood_dave) November 15, 2018

Woolworths sa food very good but offset by really poor non food sales

fashion etc. They are really battling with this. David Jones in Australia

looks better

-- Wayne McCurrie (@WayneMcCurrie) November 15, 2018