Low-price retailer Big W has reported a 0.9 per cent lift in total sales in FY26, hitting over $4.7 billion, with clothing cited as a key category of growth.
The retailer’s parent company Woolworths Group reported that total sales grew, driven more via e-commerce and its marketplace, with store-originated sales down 0.5 per cent. Store sales are Big W’s largest sales channel, making up $4.13 billion of the total $4.7 billion in revenue for FY26.
“By trading segment, clothing continued to strengthen through improved range, availability and reduced clearance activity,” the parent company reported about Big W.
“Play sales growth was driven by toys despite cycling major releases in gaming and tech in the prior year.
“Home was stable with a strong Openook performance offset by branded small appliances.
“Everyday sales remained challenged in a competitive trading environment with plans in place to improve performance, including the ‘Big Price Drops’ value campaign launched in April, and a price reset in health and beauty in Q4.”
On the total sales uptick at Big W, Woolworths Group claimed this was due to ranging discipline, better stock flow, reduced clearance activity and strong 3P sales growth.
The cycling of significant clearance activity in the prior year also led to lower volumes with a comparable item decline of 1.7 per cent in F26, offset by an increase in average selling prices from a higher mix of full price sales.
Own brand sales at Big W grew 7.5 per cent, with strong growth in toys (Somersault), home (Openook) and clothing.
Big W’s e-commerce sales hit $580 million, up by 11.5 per cent, with e-commerce gross transaction values jumping up 26.7 per cent to $956 million.
Average weekly traffic to the Big W website and app reportedly increased by 13 per cent in F26 driven by strong growth in app usage of 32 per cent.
Towards the bottom line, Woolworths Group noted that Big W has returned to profitability, with its earnings before interest and tax (EBIT) returning to green, at $64 million. In FY25, its EBIT was in the red at $33 million.
Gross margin grew by 152 basis points to 31.4 per cent, with cost of doing business as a percentage of sales dropping by 55 basis points to 30.1 per cent.
On the fall with CODB/%, Big W reported in-store and above=store productivity initiatives delivering cost savings that largely offset inflation.
CODB/% also reflected lower depreciation and amortisation resulting from the FY25 impairment of $346 million, which was partially offset by full recognition of marketplace operating costs following the integration of Big W Market (the retailer’s marketplace) into Big W during the first half. This was buoyed by the closure of MyDeal, with assets being pushed into Big W.
“Closing inventory declined on the prior year with a disciplined range reduction and better stock flow during seasonal and key event changeovers,” Woolworths Group added about Big W.
“Closing funds employed reflected a reduction in Big W’s weighted average lease term, and lower trade working capital.”
Big W’s slight uptick in sales came as Woolworths Group reported total sales of $71.5 billion. The company manages several entities, including Woolworths supermarkets, which make up the bulk of its sales.
The group’s overall EBIT grew by 12.7 per cent to $3.1 billion, with its net profit after tax (NPAT) jumping 18.1 per cent to $1.14 billion.
“Sales momentum together with strong productivity and cost discipline has delivered solid EBIT growth with an increased contribution from all trading segments,” Woolworths Group CEO Amanda Bardwell said.
“Looking ahead, while we expect the challenging economic environment to continue with household budgets remaining under pressure, our strategy to deliver low prices and the best range and convenience gives us confidence we can be first choice for customers while delivering for our team and shareholders in the year ahead.”