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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Woolworths Group Limited    WOW   AU000000WOW2


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Woolworths : 2020 AGM Address and Presentation

11/17/2020 | 10:25am EST

12 November 2020

ASX Market Announcements Office

Australian Securities Exchange

20 Bridge Street

Sydney NSW 2000

AGM Presentation and Address

Please see attached the presentation and prepared address to today's Woolworths Group AGM.

Marcin Firek

Company Secretary

Woolworths Group Limited

WoolworthsGroup Limited ABN88 000 014 675

1 Woolworths Way, Bella Vista NSW 2153

Annual General Meeting 2020

CEO's Address

Thursday 12 November 2020, 10 am (AEDT)

Good morning everyone.

As the video shared earlier today highlighted, the events of 2020 have significantly changed the way we live and work. It has also tested the resilience and agility of many Australian businesses in responding to a year of unprecedented challenges.

At Woolworths Group, it was the year that we truly lived our purpose of creating better experiences together for a better tomorrow.

F20 started with the ongoing impacts of a severe drought in Australia, the White Island tragedy in New Zealand and unrest in Hong Kong. Soon after, bushfires devastated the East Coast of Australia from October 2019 to early February 2020, and then of course there was COVID-19, which still looms large as I speak.

Through the incredible efforts of the extended Woolies team over the last year, we have been able to support our customers and communities when they needed us most.

As a Group, we wanted to lead in role-modelling COVIDSafe behaviours across our team and make them a normal part of how we operate and live. We developed group-wide COVIDSafe standards, invested in the physical protection and mental wellbeing of our team, appointed a Chief Medical Officer to enhance our decision-making, and launched the Woolworths Group COVIDSafe website to provide up to date information and alerts for our customers, team and other businesses.

It is a testament to our team and their commitment in doing the right thing that we have been able to effectively manage the disruptions throughout the year, continue to put our customers first, while still making progress against our strategic priorities.

Our focus on being Customer 1st and Team 1st drove a non-negotiable attitude towards customer and team safety during the year.

This was recognised by customers and team alike and was reflected in strong growth in our customer, brand and reputation metrics in F20. We were also proud to be named Australia's second most trusted brand during COVID-19 by the Roy Morgan Risk Monitor.

To recognise the extraordinary efforts and contribution of the team during this year, we announced the 'Better Together Recognition Award' in June. As a result, I am delighted that more than 100,000 team members are now shareholders of Woolworths Group, creating the largest employee share ownership plan in Australia and New Zealand.

At last year's AGM I spoke about my disappointment after discovering we had inadvertently underpaid some of our salaried team members. It was imperative that we worked as fast as possible to remediate those team members. To date we have repaid $281 million and expect to have repaid all impacted team members for six years covered by the GRIA and HIGA awards by early next year. We have also done a lot of work during the year to improve our internal processes to ensure this does not happen again.

Despite the many challenges of F20, we have maintained focus on fostering diversity across our businesses. We have done this through our gender equality initiatives, refugee employment program, the launch of our second Reconciliation Action Plan, and the Resourcing the Future Employment Program, which supports employment opportunities for Aboriginal and Torres Strait Islander Australians.

We were proud to be recognised with gold tier status in the 2020 Australian Workplace Equality Index for the third year running, which recognises our efforts to support LGBTQ+ team members across Woolworths Group.

Woolworths Group Limited ABN 88 000 014 675

1 Woolworths Way, Bella Vista NSW 2153

It was a transformative year for our digital businesses. From the time of the escalation of COVID cases at the end of February, there has been a material step-change in the demand for the convenience of online shopping and home delivery as well as a material increase in the number of customers who are looking to engage with us via our digital platforms.

After disruption to our online services during the March and April surge buying, we rapidly added capacity to meet demand. We also scaled up Priority Assistance, contactless delivery, and Community Pick up, to make it easier for our vulnerable customers to safely access their food and everyday needs.

At year-end, Group eCommerce sales had grown 42% on the prior year with record sales penetration of 5.5%. And this demand has shown no signs of slowing. Group eCommerce sales growth for the first quarter of F21 was 87% with Australian Food eCommerce growth of 100% on the same period last year.

Our new Everyday Rewards app was launched in May and by the end of Q1 had been downloaded over 2.3 million times, giving customers better access to personalised offers as well as new features such as e- receipts.

During the year, we have also delivered more personalised and relevant customer experiences through our digital channels such as smart shopping lists, dynamic search, and personalised value. Average weekly traffic to Woolworths' websites and apps increased materially during the year with over 10 million weekly visits in Q4 F20, up 79% on the same time last year. This growth has continued in F21 with 11.4 million average weekly visits in the first quarter.

The in-store experience changed dramatically this year as customers prioritised their safety and hygiene. We worked quickly as part of our COVIDSafe plans to create a safe experience for both customers and our team.

Despite this shift in focus, we were still able to make good progress on differentiating our food customer propositions via the in-store customer experience.

We completed 72 Renewals in F20, including our latest value format in Mt Druitt, our Smart Store 2.0 in Millers Junction and our first store that uses 100% renewable energy at Burwood Brickworks.

We also made progress on our eStores in Australia and New Zealand, stores designed to fulfil online orders using automation. We are trialling micro-fulfilment technology to pick our online orders more efficiently. Last month, our first trial store in Carrum Downs picked its first orders using Takeoff Technologies automation from its e-com floor located at the back of the existing supermarket.

Operating sustainably also remained a key priority during the year. We continued in our efforts to reduce plastics across our operations with 237 tonnes of plastic packaging removed from fruit and vegetables in F20 and six billion single-use plastic bags removed from stores in the last two years. But this is a journey and we still have a long way to go on our sustainability agenda which I will touch on a little later.

In Endeavour Drinks, we materially improved the customer experience in a number of areas during the year and also prioritised making it easier and safer for customers to shop in response to COVID.

In Dan Murphy's and BWS, improved digital and in-store experiences resonated with customers. We also made good progress on range to ensure the right range for every customer in every store. My Dan's loyalty program continued to grow in the year, with memberships reaching a new record 4.5 million in F20, an increase of 29% on last year.

The Endeavour Drinks business also scaled up its convenience offer in response to COVID with Dan Murphy's rolling out contactless Drives to over 50% of its fleet and BWS rolling out On Demand to over 950 stores.

To support small and independent local producers impacted by COVID, Endeavour Marketplace was extended to provide those producers with a route to market. Through this initiative, the business fast-tracked over 400 new suppliers and over 4,000 new products both in-store and via its online marketplace.

We also made significant progress on our portfolio this year.

Woolworths Group Limited ABN 88 000 014 675

The material profit improvement in F20 for BIG W was a particular highlight. This was made possible through the sustained multi-year efforts of the BIG W team to enhance range, value and in-store experience and their successful response during COVID to meeting customers' home, leisure and entertainment needs.

The team also quickly scaled up its eCommerce business, rapidly launching new online hub stores and establishing contactless Drives across a number of sites to meet the demand for safe online experiences.

We also continued our focus on building strategic partnerships as part of Woolworths Group's Food and Everyday Needs Ecosystem, including our announced investment in PFD Food Services. This investment remains subject to ACCC approval and is a logical adjacency for Woolworths Group. PFD will continue to be run as a stand-alone business by the Smith family and we expect it to unlock a number of synergies for both businesses across the combined warehouse network and fleet.

After gaining shareholder approval at last year's AGM, the restructure and merger of ALH and Endeavour Drinks to form Endeavour Group was completed in February.

Since then, the team has been working hard behind the scenes to build the right systems and establish the many partnership agreements between Endeavour Group and Woolworths Group.

The material financial impact on the Hotels business following the onset of COVID resulted in the Board making the decision to defer the separation of Endeavour Group until calendar 2021. The specific timeline is subject to ongoing review, but we remain committed to the separation and will update our shareholders once more clarity around timing is available.

Our priority of improving end-to-end processes to support the safety of our team and customers was critical during the year and remains critical today.

In F20, our safety metrics improved significantly against targets set for the year, including a 19% reduction in our Total Recordable Injury Frequency Rate from F19.

We also advanced our holistic wellbeing approach in F20, focusing on mental health and financial assistance to support team members through the challenges the year presented. This included the scaling up of our mental health program 'I am here', and Woolworths Financial Wellbeing program via Good Shepherd Microfinance, as well as the introduction of COVID-specific and vulnerable leave entitlements, and a material increase of on-site counselling support.

In our ambition to make it simpler for our stores, we have continued to transform and upgrade our supply chain network. In June we announced the construction of an automated Regional DC and semi-automated National DC in Moorebank, NSW which will take place over a number of years.

This investment in our NSW supply chain will unlock greater capacity for growth, improve efficiencies, advance our localised ranging efforts, and deliver better and safer experiences for Woolworths Supermarkets and its team members.

Turning now to our financial results for the full year. In F20 we achieved strong sales growth across all our businesses, excluding Hotels.

F20 sales from continuing operations were $64 billion, up 8.1% on a normalised basis compared to F19.

After a strong first half with normalised EBIT growth of 11.4%, EBIT growth in the second half was impacted by COVID costs and the closure of Hotels for much of the last four months of the financial year.

EBIT from continuing operations before significant items increased by 18.3% on a reported basis with the growth compared to the prior year benefitting from the introduction of the AASB 16 accounting standard. On a normalised basis, EBIT from continuing operations before significant items was 0.4% below F19.

Last week we announced our sales results for the first quarter of F21. It has been a pleasing start to the year with all retail businesses continuing to deliver strong sales growth.

COVID-related costs remain material but have moderated as we become more efficient at operating COVIDSafe.

Woolworths Group Limited ABN 88 000 014 675

This is an excerpt of the original content. To continue reading it, access the original document here.


Woolworths Ltd. published this content on 12 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 November 2020 15:24:02 UTC

© Publicnow 2020
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