Retailer in doldrums with £67m loss
Losses at variety retailer Woolworths soared over the first half, but the group said it expects performance to improve during the rest of the year.

The group, which is being eyed by Icelandic raider Baugur, according to reports, reported an adjusted first-half loss of£66.8 million for the 26 weeks to July 29. This was against a loss of£36.2 million for the year before. Like-for-like sales at the business fell 8.3 per cent.

Woolworths chief executive Trevor Bish-Jones said that Woolworths' figures were weak because of tough market conditions, but said he expected a better performance in the second half, during which time there will be a store revamp programme and improvements to the chain's multichannel offer.

Woolworths' like-for-like sales were down 3.5 per cent for the seven weeks to September 16 - an improving trend driven by normal weather patterns and stronger performance from the entertainment category, according to the retailer.

Bish-Jones said the retail business faces some strategic channels, as well as opportunities, going forward. Tricky areas highlighted by the group include the long-term sustainability of the 'physical entertainment product market' and rising property costs.

Woolworths also operates entertainment wholesales and publishing businesses, 2 Entertain, Entertainment UK (EUK) and Total Home Retail, which the group acquired earlier this month.

Bish-Jones said: 'The immediate prospects for 2 Entertain look bright on the back of its Christmas release schedule and for EUK the acquisition of Total Home Retail gives a broader customer base and a wider range of revenue streams.'

Over the period, Woolworths refitted 68 stores to the 10/10 concept and plans to complete the roll-out of 92 Ladybird children's clothing shop-in-shops by Christmas.

A Woolworths in store and home catalogue will launch in October, offering 5,000 lines.