Supermarket giant Woolworths has announced a “solid first quarter” with sales up to $13.9 billion from $13.367 billion in the same period of last year.
“This sales result is a solid start to the financial year which continues to hold underlying challenges for the retail sector such as tighter consumer spending and deflationary impacts of the stronger Australian dollar,” Woolworths CEO Michael Luscombe said.

The company saw its food and liquor sales for the first quarter increase by 3.2 per cent to $9.292 billion.

The company said in a tougher retail environment, its strategies of reducing shelf prices, continuing to evolve new formats and customer engagement have enabled it to maintain market share and grow customer numbers, items sold and basket size.

Similarly, its New Zealand supermarkets achieved sales of NZ$1.4 billion for the quarter, an increase of 4.7 per cent NZD terms (2.8 per cent in AUD).

The results were supported by the roll out of new format stores, improved in-stock position, improved ranging and private label offer and conversion of stores to the value positioned Countdown brand, resulting in gaining greater market share.

On the other hand, BIG W sales for the quarter slipped 2.7 per cent to $1,066 million while comparable sales decreased by 3.9 per cent. This same scenario was also seen by the company’s total consumer electronics sale which grew by only 4.1 per cent.

Woolworths said tightened consumer spending and the effects of the 2009 government stimulus package combined with the strengthening of the Australian dollar were to blame.