AUSTRALIA'S WOOLWORTHS LOOKS TO IMPROVED PROFITS
Woolworths Ltd <WLWA.S> said policy,
management and financial changes initiated during the 1986/87
business year should cause profits to reach more acceptable
levels in 1987/88 end-February 1.
    Net profit reported earlier fell 85.3 pct in the year ended
February 1.
    Results for the first month of the new year were
encouraging after a period of uncertain consumer confidence and
difficult trading conditions, it said in a statement.
    The Big W discount store division and New South Wales
supermarkets produced very disappointing results, it added.
    Woolworths earlier reported a fall in net profit to 9.27
mln from 63.20 mln on sales of 5.47 billion against 4.83
billion. Capital spending for the year was 119 mln dlrs against
105 mln for the previous year with 50 new stores opened, but
total sales were below target, Woolworths said.
    The company provided 20 mln dlrs against operating profit
for the year to cover mark-downs on stock.
    Extraordinary items included a 53 mln dlr profit on the
sale of properties and investments less a 28 mln provision for
reorganising the Big W chain.
    Woolworths is unrelated to the U.S. Group F.W. Woolworth
<Z.N>. It has been the subject of takeover speculation since
<Industrial Equity Ltd> acquired a 20 pct stake last year.
    New Zealand's diversified investment group <Rainbow Corp
Ltd> bought Safeway Stores Inc's <SA> 20 pct holding in
Woolworths for 190 mln dlrs late last year.
    Safeway put its stake up for tender just in time to take
advantage of changes in U.S. Tax laws effective from the end of
December, informed sources said.
    Woolworths shares closed on Australian stock exchanges
today at 3.50 dlrs, down five cents from Friday.
 REUTER
