Woolworths to slash 500 jobs and explore sale of EziBuy in billion-dollar restructure

Struggling supermarket giant Woolworths is slashing 500 jobs and will take a charge of $959 million against its profit as it continues restructuring its operations within a competitive retail industry.

The retailer will be hit with a $766 million after-tax profit impairment for the 2016 full year with earnings before interest and tax now expected to be in the range of $2.55 billion to $2.57 billion.

Woolworths is separating its Big W and Ezibuy businesses and wants to sell the latter, and also said it is moving another 1000 jobs from group offices into businesses, slowing its store roll-out and closing underperforming outlets.

A statement issued by the group said “five Big W stores” had been identified to close “based on current trading performance”.

It also said 30 stores would close, including 17 supermarkets in Australia. Three stores are all expected to shut before the end of financial year.

Woolworths chief executive Brad Banducci said a tough industry meant changes were necessary.

“We have significantly slowed our new supermarket rollout program to focus on renewing our existing stores,” he said.

“We will close some underperforming and non-strategic stores and cancel or defer pipeline stores to allocate more capital to renewing our existing store network.

“While we have had to make some tough decisions and this has ramifications for many of our team, we are confident we are putting in place solid foundations for the future and early results give us confidence we are on the right track.”