Woolies Chief Warns for a Downbeat Christmas

Christmas wouldn't be so merry after all for retailers, according to Woolworths (WOW) yesterday during their annual general meeting as Woolies Chief Grant O'Brien describes the condition of the industry as the worst he has ever seen.

"It is probably the most challenging period in retail I have ever seen in my career," O'Brien said. With David Jones reporting an 11 percent decline for its first quarter, O'Brien believes that the industry will struggle until the next fiscal year. "In the short term, the realities and challenges mean we believe trading will remain subdued, most probably through to the next financial year," he said.

As the yuletide season comes, the Australian Retailers Association (ARA) said that contrary to the traders' expectation in increase in sales, the industry should expect a downbeat Christmas as consumers will spend more money on food than gifts. "Shoppers will more likely opt to spruce up the house and put on a family feast rather than put more presents under the tree," ARA Director Russel Zimmerman said.

During the AGM, O'Brien said that despite the condition of the industry, their supermarket chain is still going to continue rolling out new stores and investing in house-brand products.

Woolworths shares closed almost a per cent higher at $24.56.