Australia’s Woolworths to record near $1 billion impairment for 2024 By Reuters

(Reuters) – Australian supermarket-chain Woolworths on Monday said it will record a non-cash impairment of NZ$1.6 billion ($974.40 million) for its fiscal 2024 half-year results following a review of its New Zealand Food segment.

The impairment will result in a write-down against the company’s current goodwill balance of NZ$2.3 billion, Woolies said.

The country’s largest grocer had originally acquired wholesaling and supermarket assets of Foodland’s New Zealand business in 2005 in a deal valued at A$3.38 billion ($2.22 billion).

“It is prudent to review the carrying value of the goodwill on the balance sheet that was booked as part of Woolworths Group’s original acquisition of Foodland’s New Zealand business in 2005,” the firm said in a statement.

The New-Zealand business has been seeing effects of weaker medium-term market outlook and organisational transformation initiatives yet to reach full potential, Woolies said.

It expects to report first-half earnings before interest and tax (EBIT) of NZ$71 million for the New Zealand segment, 42% below what was record a year ago.

($1 = 1.6420 New Zealand dollars)

($1 = 1.5209 Australian dollars)