Strong wholesale operations boost group's performace amid potential takeover
Woolworths Group beat analyst forecasts with the release of its annual results today, despite turning in an unexceptional performance at its core Woolworths chain.

The company - which is the subject of a potential takeover bid from private equity firm Apax Partners - reported a 4.7 per cent rise in pre-tax profits for the year to January 29, to£73.1 million from£69.8 million the year before. Group sales were up 4.5 per cent, although retail sales were down 1.7 per cent during the period. Like-for-like sales at the Woolworths chain were down 1.3 per cent and operating profit from the division overall fell from£46.2 million to£40.7 million. However, a strong performance was recorded at Woolworths' entertainment wholesale and publishing businesses. Operating profit for the division rose 16.8 per cent to£49.3 million, compared with£42.2 million the previous year.

'Our entertainment wholesale and publishing businesses have had an excellent year. The performance of Woolworths was more mixed,' said Woolworths chief executive Trevor Bish-Jones. 'Despite the more challenging consumer environment, we continue to see plenty of opportunity to improve the performance of the business as we have done consistently since demerger.'

Evolution analyst Nick Bubb noted: 'Woolworths results are pretty much in line. Apax really wants the entertainment wholesale and publishing operations, but may yet be scared off by the fact that the retail chain is running hard to stand still.'

Apax could table an offer for Woolworths by early May.