Advances in customer offer and store portfolio across 2007 leaves business well placed to make continued progress, says chief executive.
Woolworths' chief executive Trevor Bish-Jones believes that a year of substantial change and profit improvement across the group will help the retailer make further progress in its new financial year.
Commenting on the group's preliminary results for the year ended February 2, 2008, Trevor Bish-Jones, said: "Given the advances made across the business last year and our plans to make further improvements this year to the customer offer and the store portfolio, while continuing to cut costs, we are well placed to make continued progress in this financial year.
He continued: "Whilst current like-for-like sales are up against last year, the much earlier Easter makes the like-for-like comparisons meaningless. It is early days and the retail environment is likely to remain challenging in the current year. We will, therefore, continue to manage the business tightly."
The chief executive made the comments after cutting its dividend payout by 87% despite reporting a 30% increase in full-year profit.
Mr Bish-Jones said the previous level of dividend was causing cash to exit the business.
For the year to Feb 2 2008 the final dividend is 0.17 pence, down from 1.34 pence last time.
Underlying pretax profit for the period increased to £28.3 million, up from £21.8 million in the previous year.
Sales during the period rose 8.5% to £2.97bn.
Woolworths said it planned to reduce excess space in 80 of its stores by sharing parts of larger stores to other retailers such as JJB Sports, and that it will open a few concessions in branches of food retailer Somerfield starting at the end of the week.
Highlights in sales came from Worthit!, multi-channel, and the Big Red Book.
In summary Mr Bish-Jones said: "The prime objective for the year was to enhance profitability. This was achieved as we continued to improve cost performance, worked hard to deliver profitable sales and continued to focus on enhancing both the service and product offer for our customers.
"We now have a base on which to build for the coming years.
"Overall, across the group we believe we enter 2008/9 with the businesses strengthened relative to the prior year and well set up for the challenge ahead."