Woolworths just signalled that the inflation crisis hasn’t even begun yet
The supermarket giant said in its quarterly update that its full-year EBIT growth is no longer set to be in the upper end of the guidance range.
Nobody knows how long the Iran war will last, but Woolworths’ earnings downgrade on Thursday is the strongest signal from the ASX to date that the inflation caused by the conflict could get worse.
Speaking to analysts, Woolworths CEO Amanda Bardwell warned that “the inflationary impacts coming through from our suppliers, you know, our commitment to an always-on cost discipline, is incredibly important over the next 6 and 12 months ahead”.
Ahead of this, the supermarket giant said full-year EBIT growth for the Australian food segment was no longer expected to be at the upper end of its previously guided “mid to high single-digit” range on the $2.75 billion posted in FY25 amid increasing fuel and supplier costs as well as ongoing promotional activity.
Woolworths simultaneously said it would freeze prices on 300 of the supermarket’s own and exclusive brand products for the next three months in the hopes of “rebuilding trust with customers” and building on the “learnings of the last inflationary events”.
