By Mike Cherney
SYDNEY--Supermarket chain Woolworths Group Ltd.'s total sales at its key Australian food business declined slightly in the March quarter, moderating after a coronavirus-triggered boom last year.
Woolworths said total Australian food sales in the March quarter--the third quarter of its fiscal year--fell 0.7% from a year earlier to 11.1 billion Australian dollars (US$8.65 billion).
Sales rose 8.2% in the first seven weeks of the quarter--before the coronavirus pandemic hit--but slid 9.6% in the last six weeks.
Overall, total comparable sales in the Australian food business fell 2.1%, Woolworths said.
"In general, customer shopping behaviors continue to normalize," Chief Executive Brad Banducci said. "While food customers are still shopping less frequently, the growth in the number of items customers put in their baskets is slowing."
More broadly, Woolworths said total group sales in the quarter reached A$16.6 billion, a 0.4% rise from a year ago. Total sales at its Big W discount department store rose 18.3%, Endeavour Drinks sales rose 6.3% and hotel sales rose 11.5%. New Zealand food sales fell 6.9% in local currency.
Looking ahead, Woolworths said it continued to expect sales to decline over the March-to-June period for all businesses other than hotels. Sales growth in the first three weeks of April was volatile, the company said, affect by prior-year growth rates and the timing of public holidays. In Australian food, total sales in April so far have been broadly flat compared with last year.
Woolworths added that its Endeavour Group demerger remains on target for late June. Woolworths also said the condition precedent relating to regulatory approval for its deal to buy a stake in food distributor PFD had been extended to February, due to a longer review process from regulators.
Woolworths also said it won't proceed with a controversial new location for its Dan Murphy's liquor chain in Darwin. An independent panel set up by Woolworths determined that the company didn't do enough stakeholder engagement with local indigenous communities and organizations.
The new location had been opposed by community and health groups that were concerned the store would be too close to dry indigenous communities where alcohol use is a problem.
The panel "made it clear that we did not do enough in this community to live up to the best practice engagement to which we hold ourselves accountable," Woolworths Chairman Gordon Cairns said.
Write to Mike Cherney at mike.cherney@wsj.com
(END) Dow Jones Newswires
04-28-21 2216ET