Woolworths announces $1bn loss, appoints new CEO

Woolworths announces $1bn loss, appoints new CEO

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Australian supermarket chain Woolworths has announced a loss of $1bn due to the price war. The supermarket giant along with Coles, form a near duopoly of Australian supermarkets, together accounting for about 80% of the Australian market. Woolworths has also stated that Brad Banducci would replace the outgoing chief executive, Grant O’Brien as the company’s new chief executive officer.

The company, facing fierce competition and price wars, expects Brad Banducci to revive the supermarket to the winning ways. Woolworths’s decision in January to pull the plug on its Masters hardware chain will cost $3.25bn before tax in a one-off impairment. The new developments would hit the Woolworths share holders the hardest, at $972.7m. Due to the falling oil prices affecting the pump prices the revenue from Australian food, liquor and petrol declined 2.58% to $24.96bn. Profits before one-off charges were down 33%.

Previously Banducci was the head of Woolworths supermarket division and prior to that he was working as the head of Dan Murphy’s liquor stores. During last year June, Grant O’Brien said he would step down as the CEO of the company after his plan to revive the business failed.  The chairman of the holding company, Woolworths Limited, Gordon Cairns said, “We undertook a rigorous international search process to find the best person to rebuild the Woolworths business and return it to sustainable growth.”  “Despite the financial performance, we are making progress in the rebuilding of Woolworths,” Woolworths in its statement to the ASX said.

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