Woolworths Holdings’ profit margins pressured amid South African unit challenges

Published 05/03/2025, 08:24
© Reuters.

Investing.com -- Woolworths Holdings Ltd (JO:WHLJ)., a retailer of fashion and designer clothing, is facing a squeeze on its gross profit margins as attempts to rectify its South African clothing unit have not fully come to fruition.

The firm reported on Wednesday that its first-half profit margin for the unit fell by 170 basis points to 46.3%.

The Cape Town-based retailer is experiencing an increase in volumes due to slowing inflation. The most severe cost pressures in the food sector, which contributes to over half of the company’s revenue, are showing signs of alleviation.

This easing in the food sector has helped to lift Woolworths’ total revenue by 5.7% to 40.3 billion rand ($2.2 billion).

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