Woolworths in Australia Reports Lower-than-Expected Sales, Stock Prices Drop
Woolworths Annual Profit Decline: Australia's leading supermarket chain, Woolworths, reported a 19% drop in annual profit due to price cuts aimed at addressing consumer backlash and sluggish sales growth.
Sales Growth Below Expectations: The company experienced weaker-than-expected sales growth of only 2.1% in the first eight weeks of the new fiscal year, falling short of analyst forecasts.
Regulatory Scrutiny: Woolworths, along with rival Coles, is facing lawsuits from the Australian Competition and Consumer Commission for allegedly misleading pricing practices, which has contributed to reputational damage.
Future Outlook and Challenges: Despite expectations for mid- to high-single-digit earnings growth in the current financial year, Woolworths warned of potential headwinds from declining tobacco sales and other operational challenges impacting profitability.
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