Woolworths struggles to win back ‘price trust’ from customers – and investors – as Coles’ value rises
Woolworths has shed more than $5bn in market value as it struggles to regain customer “price trust” and stretches product availability.Australia’s biggest supermarket chain on Wednesday reported sales rose 3% in the year to June and 2% in July and August compared to the year before, while profits in 2024-25 fell by a fifth, to nearly $1.4bn.Its market value slipped from more than $40bn to less than $35bn on Wednesday, while Coles rose to a record value of $31bn.Coles has attracted a greater share of sales, recording faster growth of 4% in the year to June and 5% in July and August on the year before, lifting annual profits to more than $1bn.
Woolworths cut the shelf prices of 500 items in 2025 in a bid to regain customers’ trust and improve public perception, but chief executive Amanda Bardwell told investors sales momentum was yet to pick up.“That was always about a long-term investment … to build price trust after a very disruptive 12 or 18 months, so that will take time to flow through,” she said on Wednesday.Short-term boosts such as Woolworths’ Disney Discs promotion in July had also underperformed, Bardwell said, blaming it on customer “fatigue” after running collectible programs “multiple, multiple times”.The company forecast supermarket earnings would grow slower than market expectations, with price cuts to sap $100m.One analyst said the slowing shopper momentum signalled customers were switching from Woolworths to Coles.
“That’s $100m of earnings they’re basically sacrificing to lower shelf prices to rebuild customer trust [and] Coles will be looking at this and thinking … ‘how we can respond?’” said Lochlan Halloway, an equity markets strategist at Morningstar.“Coles is taking share from Woolworths … and I don’t think [investors] can see, at the moment, a credible path for Woolies to close the gap,” he said.Michael Toner, an RBC Capital Markets analyst, agreed that Woolworths’ ongoing underperformance suggested the company was continuing to lose market share to Coles.Stock availability issues at Woolworths had impacted perceptions and customer satisfaction, with consistent shortages on Sundays, Bardwell said on Wednesday, citing the impact of industrial action at Woolworths’ warehouses.Coles’ product availability, meanwhile, has been boosted by new centres distributing products to supermarkets and online shoppers, Coles’s chief executive, Leah Weckert, told investors this week.
“Our availability metrics are probably now at the best we’ve seen them since pre-Covid,” she said.Weckert said product delivery had helped Coles take advantage of “green shoots” in consumer spending, as household budgets recover and inflation and interest rates ease.“[Customers] are still very cautious … so entertaining at home, eating at home instead of eating out, shopping at multiple retailers: that’s all still quite prevalent,” she said.“You put those three things together and that’s a combination that’s working quite well for us as a supermarket.”Coles’s pre-tax margin on earnings rose to 5.
3%, with its expanding distribution centres helping cut costs to get products in stores and to online shoppers, and stock loss declining.Woolworths’ pre-tax margin slipped to 4%, as theft and product waste rose and customers swapped from their typical purchases to cheaper alternatives, according to the company.Investor sentiment could turn, however, as Woolworths’ price cuts brought back customers, Halloway said, noting neither was likely to lose market dominance.“These are century-old businesses, and every now and again, one’s going to outperform the other,” he said.“They’re the dominant players, and I don’t expect that to be eroded.
”Both supermarkets have faced pressure in the last year over findings they hiked prices during a cost-of-living crisis to boost profits and are defending legal proceedings over allegations they misled shoppers by offering “illusory” discounts on hundreds of common products.
Thames Water agrees payment plan for £123m sewage and dividend fines
Thames Water has agreed a payment plan with the industry regulator for fines it owes worth £123m, as it races to secure funding to avoid temporary nationalisation.The utility company, which serves 16 million customers across London and the south-east, is trying to pull together a deal to avoid collapse.The debt-laden utility company was hit with a record £104m fine by Ofwat in May over environmental breaches involving sewage spills, after failing to operate and manage its treatment works and wastewater networks effectively.At the same time, a further £18.2m fine was levied on Thames for breaking dividend rules, the first penalty of its kind in the water industry
Scottish government trial of four-day week improves productivity and staff wellbeing
Increased productivity and improved staff wellbeing were among the results of a year-long trial of the four-day week by the Scottish government.Two public bodies, South of Scotland Enterprise (SOSE) and Accountant in Bankruptcy (AiB), took part in the pilot, which was launched by Holyrood in early 2024.The two organisations, which had 259 employees in total throughout the trial, implemented a 32-hour working week for a year without any loss in pay or benefits for staff, while committing to maintaining standards of service.AiB and SOSE staggered the non-working day among staff to allow the bodies to function as normal, while part-time staff were offered proportional reductions in their working time.Staff at the two organisations reported less work-related stress and greater satisfaction with their jobs and work-life balance
Teen killed himself after ‘months of encouragement from ChatGPT’, lawsuit claims
The makers of ChatGPT are changing the way it responds to users who show mental and emotional distress after legal action from the family of 16-year-old Adam Raine, who killed himself after months of conversations with the chatbot.Open AI admitted its systems could “fall short” and said it would install “stronger guardrails around sensitive content and risky behaviors” for users under 18.The $500bn (£372bn) San Francisco AI company said it would also introduce parental controls to allow parents “options to gain more insight into, and shape, how their teens use ChatGPT”, but has yet to provide details about how these would work.Adam, from California, killed himself in April after what his family’s lawyer called “months of encouragement from ChatGPT”. The teenager’s family is suing Open AI and its chief executive and co-founder, Sam Altman, alleging that the version of ChatGPT at that time, known as 4o, was “rushed to market … despite clear safety issues”
US parents and teachers: share your experiences of AI in schools
Students in grades K-12 have been invited by Melania Trump to take part in a nationwide contest designed to encourage the use of artificial intelligence (AI) tools to help solve community issues. The first lady wants students to “unleash their imagination and showcase the spirit of American innovation” by participating in the government-sponsored contest.We want to hear from parents and teachers on their experiences of AI in schools. How do you feel about it being used in education? Do you support it or are you against it?You can tell us what you think of the use of AI in schools by filling in the form below.Please include as much detail as possible
US Open tennis 2025: Raducanu, Djokovic and Pegula in action on day four – live
So farm Svajda is doing nicely, 2-2 against Djokovic, and with Raducanu blazing a return past Tjen for 4-0, I’m going to pay that match more attention – though first i’m checking the draw, so well is she playing. And next up, it’s Rybakina or Valentova – tasty.Navarro did indeed take the first set off McNally 6-2; Azarenka has broken Pavlyuchenkova back for 3-3; Etcheverry took the first set against Lehecka 6-3 but trails by a break at 1-0 in the second; and Nakashima is trying to serve out the first set at 5-4 against Kym.I’ve never seen Svajda play before, so I’m interested to see what be brings. To get to this stage he won four quallies then his first-round match, which tells us he’s in form
Ryder Cup: USA captain Keegan Bradley does not pick himself to play at Bethpage
Keegan Bradley has opted against becoming the first Ryder Cup playing captain since 1963. The United States captain named his eagerly awaited six wildcard picks on Wednesday, taking the difficult decision not to try to combine roles in New York next month.Bradley is ranked 11 in the world but opted for others. Justin Thomas, Collin Morikawa, Ben Griffin, Cameron Young, Patrick Cantlay and Sam Burns received the captain’s call. Bradley reflected on “the most incredible year of my life” as he announced his decisions during a media conference in Texas
101 uses for XO sauce | Kitchen aide
Ixta Belfrage’s recipes for charutos with spicy tomato broth, and guava, curry and chilli meatballs
Rukmini Iyer’s quick and easy recipe for crispy butter bean, chorizo and cos salad | Quick and easy
Sami Tamimi’s recipes for courgette and maftoul bake, and sumac-marinated feta salad
How to make the perfect fish finger sandwich – recipe | Felicity Cloake's How to make the perfect …
Bellota, Bury St Edmunds: ‘Just fabulous food’ | Grace Dent on restaurants