Woolworths 1st Half Profit Hit By Worker Pay Dispute, Still Boosts Dividend

By Mike Cherney

SYDNEY--Australian grocer Woolworths said its half-year net profit declined due to a dispute over staff underpayments, but it still boosted its dividend and said underlying performance had improved.

Woolworths said its statutory net profit in the half year to Jan. 4 was 374 million Australian dollars (US$264.1 million), a decline of 49%. Before significant items, however, Woolworths said profit was A$859 million, a rise of 16%. Group sales rose 3.4% to A$37.1 billion.

Woolworths declared an interim dividend of 45 Australian cents per share, up from 39 cents in the prior corresponding period.

The decline in statutory net profit was largely attributable to a A$710 million pre-tax charge relating to the underpayment of workers, following a decision from Australia's Federal Court.

More broadly, Woolworths said that sales rose 3.6% in Australian food, 2.8% in New Zealand food in local currency, and 2.7% in its W Living unit in the half.

Looking ahead, Woolworths said that trading in the fiscal third quarter to date has been strong in Australian food, its main division. But it flagged that consumers remained value focused and were shopping with multiple retailers in a highly competitive environment.

Australia's grocers have battled negative public perceptions in recent years, inpart because they've posted strong profits at a time when consumers are struggling with cost-of-living issues.

Ahead of the result, some analysts were concerned that margins had come under pressure amid a step-up in promotional activity. The company previously flagged that trading in the fiscal first quarter was below aspirations.

Write to Mike Cherney at mike.cherney@wsj.com

(END) Dow Jones Newswires

February 24, 2026 18:07 ET (23:07 GMT)