Woolworths CEO Ian Moir has declared “the worst is over” for the retailer’s struggling Australian subsidiary David Jones that has sparked investor fury because it hasn’t lived up to expectations since it was acquired five years ago.
Woolworths will beef up the department chain’s online offering and shrink store space by as much as 20% by 2026 through lease negotiations. David Jones has succumbed to these market pressures as the department chain saw sales fall by 0.8% during Woolworths’ reporting period. The gross profit margin – a key metric for profitability in retail – was 1.1% lower.
Moir’s move to Australia was sparked by boardroom drama at David Jones when the retailer’s CEO, David Thomas, resigned with immediate effect in February 2019 – becoming the fourth CEO at David Jones to resign in five years. Buss added that while Woolworths is stuck with David Jones, it will continue to drag down Woolworths’ performance for the foreseeable future.