Photo: Attila Csazar
Shares in Woolworths have risen after the supermarket chain unveiled strong first quarter food sales that continued to outpace the growth of rival Coles.Woolworths' comparable first quarter food sales at its Australian supermarkets rose 4.9 per cent to $9.63 billion, compared with Coles' 0.4 per cent lift in first quarter comparable sales released last week.
Shares in Woolworths were up 32 cents, or 1.26 per cent, at $25.62 by 1030 AEDT, their highest level since October 19 and a resumption of the upward trend taken since the stock hit a nine-month low earlier in October.
The retail giant said the comparable sales growth was achieved despite sharply lower fruit and vegetables prices, including price reductions for tomatoes, lettuce and berries due to favourable growing conditions.
Wesfarmers-owned Coles last week cited the same deflationary pressures.
Woolworths chief executive Brad Banducci said the company's strong performance had continued from the previous six months into the new financial year.
"We have continued the good sales momentum from the second half of FY17 and made pleasing progress against our key priorities over the quarter," Mr Banducci said in a statement on Tuesday.
New Zealand food sales lagged slightly with comparable growth of 2.7 per cent.
Comparable sales from Woolworths' Endeavour Drinks unit, which includes BWS and Dan Murphy's liquor stores, rose 3.3 per cent.
Sales at struggling department store Big W lifted 2.9 per cent in the 14 weeks to October 1, which Woolworths said was driven by discounting and clearance activity.
"While it is still early days in our turnaround journey, the first key element in our plan was to regain price trust with our customers," Woolworths said in a statement.
BigW's major competitor Kmart, owned by Wesfarmers, had comparable sales growth of 4.9 per cent during the first quarter
