Country Road Group has blamed low consumer sentiment for a revenue hit, with sales declining by 5% for the 26 weeks ending on December 24, 2023.
Parent company Woolworths Holdings Limited (WHL) listed challenging trading conditions and near-record low consumer sentiment for the result in an update to shareholders.
According to WHL, Country Road Group cycled off a high base in 2022, where sales grew by 25.5% following the strong recovery from the Covid-impacted lockdowns.
Sales growth for Country Road Group in the last six weeks of the period was positive, at 1.3%.
“The Country Road brand continues to deliver a market-leading performance across key categories,” WHL confirmed in a trading update. “Trading space increased by 6.6% during the period, supported by the ongoing expansion of our wholesale and concession channels.
“The contribution from online sales increased marginally to 26.8% of total sales.”
The dip in Country Road Group sales was offset by growth in WHL’s key department store subsidiary Woolworths in South Africa, which also stocks Country Road Group brands. As well as fashion, beauty and home, Woolworths in South Africa also stocks groceries.
Turnover and concession sales in the fashion, beauty and home division grew by 2.2%, with comparable store sales up by 1.5%. Sales growth in the last six weeks of the period improved to 3.8%, reportedly buoyed by strong execution in Black Friday promotions and festive season trade.
“Sales for the 26-week period were impacted by poor availability, due in part to the late arrival of certain summer ranges arising from congestion at the ports,” WHL confirmed. “Our teams remain focused on full-price sales, which positively impacted price movement of 11.4%.”
The department store’s net trading space increased by 0.3% relative to the prior period, while online sales grew by 26.9% and contributed 5.4% of South African sales.
Overall, WHL recorded a 5.4% lift in turnover and concession sales in the 26 weeks to December 24 last year. This is down from a yearly lift of 12.5% recorded in the same period in 2022, compared to 2021.
Australian consumer confidence has spent a record 51 straight weeks below the mark of 85, with the last week's score of 84.4 being the closest to 85 since February 2023.