Despite Woolworths Group recording an 8 per cent rise in sales, Covid-related costs saw group earnings decrease 11 per cent on the prior corresponding period.
The results, delivered in Woolworths Group’s H1 FY22 financial report, saw Metro Food Stores increase by 7.2 per cent to $489 million, driven largely by the addition of four new sites and strong sales in neighbourhood stores, while CBD and transit stores remained impacted by lower foot traffic.
Brad Banducci, CEO of Woolworths Group, said the company had to invest a lot more in keeping everyone Covid safe than people may realise.
“While the far-reaching impacts of COVID resulted in one of the most challenging halves we have experienced, we ended H1 strongly with positive trading momentum and helped our customers enjoy a much-needed Christmas celebration and festive holiday season.
“Omicron created new challenges in early January with a record number of team members isolating and material supply chain and stock flow issues. However, having learned from the Delta outbreak, we responded with agility and are gradually moving into a more consistent operating rhythm.”
While physical stores were impacted by lockdowns and staff isolation requirements, there was a large shift towards the company’s e-commerce platform with an increase of 48.1 per cent in sales and a rise in penetration of 11.6 per cent.
During the company’s end-to-end payroll review, it identified a one-off cost of $144 million in unpaid wages to hourly paid team members.
“We have said from the outset that we would do the right thing by our team and we are being thorough in our end-to-end payroll review. We are disappointed to have identified further inadvertent underpayments and unreservedly apologise to our affected team members. We will continue to fix issues when we identify them and introduce the right controls to prevent them from happening again,” said Banducci.