Image:Foot and clothing retail outlet Woolworths expects annual earnings to decline and has written down the value of its David Jones business, which is struggling to contend with subdued consumer spending in a slowing Australian economy.
The food and clothing group paid a big premium to bulk up in Australia via David Jones as part of chief executive Ion Moir’s ambitions to turn Woolworths into a leading southern hemisphere retailer, but faced delays in overhauling the business. The write-down, the second since 2018, frames a bleak picture for department store operators around the world as shoppers opt for broader product ranges from global online players like Amazon.com, or speciality fast fashion brick-and-mortar stores like H&M.
In response to the changing trends, David Jones beefed up its online offering, cut costs and store space and refurbished its Elizabeth Street flagship store in Sydney that will introduce exclusive brands in clothing, footwear and lingerie.