ASX Announcement Signals New Chapter for Australia’s Leading Retailer
In a landmark announcement to the ASX, Woolworths Group (ASX: WOW) has revealed plans to demerge its beverages and hospitality businesses, focusing more sharply on its core food and everyday needs retail operations. This move marks a significant milestone in the evolution of one of Australia’s most recognised retail giants.
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Strong Third Quarter Sales Reinforce Strategic Focus
On 1 May 2025, Woolworths Group released its Third Quarter Sales Results for the 13 weeks ending 6 April 2025, highlighting a solid performance across key retail metrics. The figures reflect the company’s growing momentum as it sharpens its focus on food and everyday needs.
- Group Sales rose to $17.3 billion, marking a 3.2% increase compared to Q3 FY24.
- Group eCommerce Sales surged to $2.2 billion, a strong 15.7% increase year-on-year, signalling the growing shift toward digital retail experiences.
- Group VOC (Voice of Customer) NPS reached 44, improving by 1 point from March 2024, underscoring Woolworths’ commitment to customer satisfaction and service.
These results further validate Woolworths’ strategic realignment, demonstrating that the core business is not only resilient but gaining strength amid market transformation. The strong growth in eCommerce, in particular, positions the group well for sustained digital leadership in Australian retail.
Woolworths Group 3rd Quarter Sales Results
Strategic Focus on Food and Everyday Needs
Woolworths Group’s decision to separate its drinks and hospitality interests from its core supermarket business is a strategic realignment designed to sharpen its customer focus, simplify operations, and deliver greater value to shareholders.
CEO Brad Banducci noted, “This is a significant step in our journey to become a more focused food and everyday needs business.” The restructure reflects evolving consumer trends and an increasingly dynamic retail environment, where agility and specialisation are crucial to success.
Endeavour Group Demerger: What It Means
As part of the announcement, Woolworths confirmed the creation of a new entity: the Endeavour Group. This group will encompass the company’s drinks business (formerly Endeavour Drinks) and hospitality arm, ALH Group. The combined Endeavour Group will be Australia’s largest integrated drinks and hospitality business, owning prominent retail brands including BWS and Dan Murphy’s, along with approximately 1,500 stores and over 300 licensed venues.
Woolworths plans to retain a 14.6% interest in the new Endeavour Group following the demerger. This minority holding will allow for ongoing collaboration while enabling both businesses to pursue independent growth strategies.
Strengthening the Woolworths Brand
This bold restructure will allow Woolworths Supermarkets, Metro stores, and Countdown in New Zealand to consolidate and refine their offerings without the complexity of managing drinks and hospitality venues. With a singular focus on food, convenience, and essential goods, Woolworths is poised to deepen its engagement with customers and enhance the in-store and online shopping experience.
According to the group’s statement, this change positions Woolworths for long-term growth as it continues to invest in technology, supply chain improvements, and customer service innovation.
Benefits for Shareholders and Customers
The demerger is expected to unlock value for shareholders by enabling both Woolworths and Endeavour Group to operate with greater strategic clarity. Each business will benefit from its own management team, governance structure, and capital allocation strategy, increasing agility in responding to market demands.
Customers, too, are expected to benefit. With a more focused Woolworths brand, shoppers can expect enhanced product ranges, improved value, and a seamless omnichannel experience across physical and digital platforms.
Industry Impact: A Signal to the Market
Woolworths’ move has sent ripples through the Australian retail and investment communities. Analysts view the demerger as a strategic pivot that mirrors global trends among large conglomerates divesting non-core assets to increase efficiency and shareholder returns.
The new Endeavour Group is anticipated to be a formidable player in the drinks and hospitality sector, commanding significant market share and boasting an experienced leadership team.
Meanwhile, the streamlined Woolworths will continue to leverage its dominant position in grocery retailing, competing head-to-head with rivals such as Coles and Aldi, and expanding into the fast-growing online grocery segment.
Commitment to Sustainability and Community
In line with its sharpened focus, Woolworths reaffirmed its commitment to sustainability, local sourcing, and community partnerships. The company aims to lead by example in reducing plastic waste, cutting emissions, and supporting Australian farmers and producers.
Banducci emphasised, “Our purpose is to create better experiences together for a better tomorrow. This change allows us to align more closely with that purpose and invest more deeply in what matters most to our customers and communities.”
Timeline and Implementation
The demerger is expected to be completed in the second half of the year, subject to shareholder and regulatory approvals. Shareholders will receive shares in the new Endeavour Group in proportion to their existing Woolworths holdings, ensuring continued value through the transition.
A dedicated transition team is already in place, and Woolworths has committed to a seamless separation process with minimal disruption to operations, staff, and customers.
Final Thoughts: Woolworths Eyes the Future
Woolworths’ announcement marks a transformative moment in its 100-year history. By refocusing on core strengths and spinning off high-performing but non-core businesses, the group is signalling confidence in its long-term vision and customer-centric approach.
This is more than a corporate restructure—it’s a bold strategic statement about the future of retail in Australia. Woolworths is ready to double down on food, value, and everyday essentials, setting the stage for the next era of growth and innovation.
