Woolworths Group has reported its Q1 2025 sales results and trading update, revealing a 4.5% increase in group sales to $18 billion, or 3.3% excluding Petstock, even as the cost-of-living continues to bite.

The company's e-commerce sales were reported at $2.4 billion, marking a significant 21.2% increase in Q1 2024. Australian food sales saw a 3.8% increase to $13.595 billion.

Australian B2B was up 6.9% to $1.473 billion, buoyed by PFD sales growth remaining strong at 7.8%. The acquisition of the remaining 35% of PFD is expected to complete on 31 October 2024. Third-party Primary Connect revenue was also strong reflecting growth from new cross-dock facilities.

Group food voice-of-customer NPS was down 1 point on September 2023 to 46, a figure Woolworths Group CEO, Amanda Bardwell, attributed to the announcement of ACCC legal proceedings against both Woolworths and Coles for their respective lower-prices marketing programs, plus the Federal Government's interim Supermarkets Inquiry.

"Our customers remain under real cost-of-living pressure, and we delivered much needed value to them in the quarter. We offered our customers more specials with larger savings, increased shelf capacity of our more affordable Own Brands, made it easier to find the best unit prices, provided extra value through Everyday Rewards and brought a little joy to families through the Disney Worlds of Wonder collectibles campaign," Bardwell said.

"We worked hard to improve sales momentum in our Food businesses, and this built over the quarter driven by item growth. eCommerce growth also remained strong driven by demand for our convenience offers.

"Australian Food total sales increased by 3.8% due to a strong focus on value in the quarter, improved availability, Disney collectibles and strong eCommerce sales growth of 23.6%. Customers remain highly value-conscious and continue to purchase more items on special or trade down to lower priced items including Own Brand. These competitive factors together with strong eCommerce growth is leading to a lower margin sales mix which has impacted earnings. In October to date, total sales have increased by approximately 3%."

W Living sales were also up, increasing by 17% and reflecting the acquisition of Petstock in January 2024. Woolworths pulled together the new operating segment, comprising comprising BIG W, Petstock, Healthylife, and Woolworths MarketPlus (BIG W Market, MyDeal and Everyday Market) at the beginning of the financial year. This brings together the Group's everyday needs and marketplace platform together into one operating segment.

However, BIG W sales were down 0.9% in the quarter with solid item growth offset by lower average selling prices as the group increased its range of opening price points, lowered prices and customers traded down to more affordable options.

"Despite material improvements to our new Spring/ Summer range, sales were impacted by timing of stock receipts during the quarter," Bardwell commented.

October sales to date were broadly in line with the prior year; however, trading over the rest of Q2 remains key. Petstock sales increased by approximately 5% in Q1 compared to the same period in the prior year before Woolworths Group ownership.

"In conclusion, we are pleased with the trading momentum in the lead up to the important Christmas trading period, however, we expect the environment for F25 to remain challenging. We will also continue to engage in good faith with the government and regulatory inquiries and investigations," Bardwell said.

"We know that our customers have many choices about where to shop. We don't take their support for granted and remain committed to offering the value, convenience, service and range that they expect from us."