Brad Banducci - Managing Director Australian Food and Liquor David Marr - Chief Financial Officer Sally Macdonald - Chief Executive Officer of BIG W Dave Chambers - Director of Woolworths Supermarket Colin Storrie - Group Portfolio Director Richard Dammery - Chief Legal Officer Bruce Mathieson - Chief Executive Officer of ALH Martin Smith - Managing Director of Endeavour Drinks

Andrew McLennan - Macquarie Bank Craig Woolford - Citi David Walker - Clime Asset Management Bryan Raymond - Citigroup Adam Alexander - Goldman Sachs David Errington - Merrill Lynch Tom Kierath - Morgan Stanley Grant Saligari - Credit Suisse Michael Simotas - Deutsche Bank

Thank you all to those of you who have pitched up in person today, we are trying to make things up as you would know we traditionally have had our results from northwest, so we thought it’s important to come to the city and really try to engage more into personally with all of you. So thank you for coming today.

The run in order today will be, we will discuss a few slides for about 45 minutes and then we will turn the floor open and the lines open to questions for 45 minutes and then we will eat something. We have lot for lunch and all the kinds of foods that you expect to see in our stores will be presented outside for you to hopefully mingle with us and do something informal afterwards.

So thank you for coming today. Let me just introduce you to staff from Woolworths and then we will plough into the material.

Just on the stage of course there is CFO, David Marr; Martin Smith who runs the Endeavour Drinks Group, for the time this year you will note that we have split out performance of drinks with liquor business so Martin here to answer any question you might have about that. Sally Macdonald, CEO of BIG W; Dave Chambers, CEO of Progressive Enterprises of Countdown Supermarkets in New Zealand; we have also got Colin Storrie, he is newly appointed all of Group Portfolio Director; Richard Dammery who is Chief Legal Officer; Bruce Mathieson, CEO of ALH.

An apology if I have forgotten anyone else. Just kind of thought on a few highlights and then David will go through the financials and then we will walk through the individual businesses and as I said comeback for Q&A.

I don't know we are not using the slide projector. Hope everyone can see it, but if you can't, really the key highlights of the year for me anyway have been, we have made some very material investments as you would all be aware if you look at our financial numbers back into our food business to really focus on our customers and get them to put out first.

And you will see our numbers reflect the size of the investments, the highlights to me is that in particular in the last quarter we started to see customers really start noticing those investments and starting to act on that investments in a positive way. So the focus for the year was always to make sure we booked the momentum through the year to set ourselves up for FY17 and we really felt that we saw that in food and I'll talk a little bit more as we get to that part of that business.

It's literally six months to the day but I was appointed as the CEO of Woolworths Group. And one of the things I was very keen on doing from that point and was putting in a new operating model that just provided a lot more clarity to the business, took some cost out of the center and really helped get everyone into right roles and give them the right set of accountabilities.

So the model we wanted to implement has been implemented and we have driven a lot of accountability back into the business. I could talk about this further along time, I’m not going to, I’m just going to talk to a few highlights.

Very important one to me was this year 1,000 roles that was put in the center have gone back into the business and I think retail is all about customers. Customers are in stores, you have got to be as close to the stores as possible if you have any chance of really making the difference and so getting those trials and roles back as close to the business as possible is very important.

We have also announced that we have taken 500 roles out of the food office, I'll come back and talk about our long-term agenda about becoming a leading retailer, this hopefully is the first step in the process of us reengineering processes and reducing cost. But it was an important first step for us to really go and make sure that any role that wasn't key to what was happening in store or with the customer was taken out of our business, we have done that.

And then lastly, but very importantly and Sally will talk to us, we were really forceful around giving BIG W control of all the leaders if needed to be successful. If you look at discount department stores or discount apparels in general, most of the successful business models have become really end-to-end and rather controlled the whole value chain from the customer all the way back to the factory and through the design process.

And it was essential for Sally's long-term success that we gave her control of all the leaders if she needed to be successful and that was something we did as part of influencing our new operating model. So the momentum in supermarkets despite the material investments, a new operating model, which really helped provide clarity to our portfolio businesses and our food and liquor business and really getting everyone focused on where the action is, which is in the store.

We have also not and importantly as I talked to as even investors or analysts, we really worked hard and lined up our short-term and long-term performance measures on our transformation. So probably one of the less fun things we have done this year actually, but anyway quite important thing is we worked really hard to get the right short-term measures and the right long-term ones and get them synced up.

You would be aware from announcement last month on the significant item that our key long-term measures have now become sales per square meter and we have announced you will see the numbers in our results of course of where we are and we will track it every quarter. So we have got sales per square meter, we have got return on fund employed and we have got title shareholders return or Relative TSR.

We think those are very important, because one of the key stood out transformation will be getting back to sustainable profit position, central to that is getting same-store comps up to around 2% and so that's why it needs to be such important measure. But in doing we don't want to be caviler in our use of capital, which is why we have got the return on funds measure to balance that of course.

Our short-term measures rally I have talked about in before what we have done is take our measures that we had in the store and making the same measures in the support office through really line everyone up. So we are all focused on customers, we are all focused on team as well as of curse the traditional measures of sales, profit and working capital.

So we have lined up our measures, which we think important. We are committed to providing greater transparency into our business, hopefully, you will find this results announcement is a step forward in that regard.

We still feel we have got a lot of work to do but hopefully you will taken in spirits and tender, we have given you a lot more material this time than we have before. Not only the split out of Endeavour Drinks, but also just a thought into we have better measures of inflation I would like provide even more details through that better measures on the sales per square meter and so on.

So hopefully you will see that there and it's frenetic across our business. Lastly, but certainly not least, you will have seen the announcements of yesterday where we have agreed three transactions to formalize our exit from Home Improvement.

I’m sure I'll get questions on that later, but that was a very important fit for us, something that’s Richard Dammery has in particularly lead for us get us to the point we are currently at, critical in the portfolio context to get karaoke [ph] in particularly as we went into Christmas trading. So they probably are the highlights, those are some of my key highlights, we are making progress across all the things we said we were going to do and hopefully a lot more to come in FY17.

Specifically tie in Group highlights back to our key priorities, you will see that they are very much tied back into this and my priority for our priorities upon becoming Group's CEO the first and most important was for us really to become a customer in store lead business. That's what made Woolworth's greater when it was great to very focused in stores and everyone was lined up and is what will make us successful again going forward and that's why I was very keen on implementing the operating model.

But there is only one component in driving this, customer and store-led culture back into our business and breaking down what is seen as the Northwest corporate office. A couple of other things I would just like to call out that we are doing apart from the ones you saw in the previous page.

We have implemented the Wooly’s welcome, which means that no matter who you are, whatever tie can you have, if you join us you spend your first week in store. Everyone has done it so far, I think it's fantastic, I mean envious of all of them and it's terrifically useful to them in their roles, but it also says a lot to our support teams about the orientation we have.

So that's gone very well for us. We have also started reengineering all of our feedback loops, so that if a team are unhappy in a store with produce, meat or any fresh product, we have an app that can immediately give the feedback back to the support office that is then deducted from their sales targets and if it goes to the penalty of the buying team concerned.

We really want to get feedback loop running our business that everyone cares about quality in the store and it’s directly impacted if it's not right and empower the store teams and give them the confidence to call things out when they are not happy with what they are. So a lot of work and apart from KPIs [ph] and operating models to really change our culture and really be focused as I say on customers and support, because that's where the customers interact with us.

Second on the sustainable growth momentum improved, I will talk to it later, so we have made some progress, the highlight was that voice of the customers scores, which is the way we track how our customers are feeling about us, we do about 50,000 surveys a month. And we saw record scores in June and that was really pleasing, because we have been working hard on that whole year and it was stuck in and it wasn't moving.

And then in the last few months it really started moving. And of course it's continued to move in July and August in fact we, for one we keep the number 80, which was terrific two weeks ago.

We haven't managed to sustain it yet, but it's terrific. So we really saw and last finish to the year in terms of how customers were feeling in shopping with us, it was correlated back to our net promoter score for those of you interested which is more of a brand scoring mechanics.

So we saw record customers score, we believe that that has been what has driven our growth in transactions and you will see the data later on the transaction growth that we have had coming in the back end and from autumn growth and more recently some south comp growth. You will see the data of course that one of the keys to us building trust back with our customers has been our interest in the past and it's been very material as you would all appreciate looking at our numbers.

We really felt in the first half we pooled as many into price, we didn't get the impact. We are starting to see a lot more rhythm to that in the second half.

One of the key adjustments for us in thinking about price was to balance our thinking around basket price and whether our basket of goods was equal to calls or less than calls of competitors to balancing that with shelf process and making sure not only was our basket price competitive, but so is our shelf price, because customers could often look at the shelf price and judge you on that, not judge you on the basket. So we really worked really hard in the second half of getting both of these things balanced and we finished the second half with them both where we wanted to be and we think that really helped us.

I want to talking a lot about investment in team, of course we invested a lot of our hours in the first half, in the second half we were much more forensic about that and so to just putting hours into the store in general we started working about getting hours in Saturdays and Sundays. Really just within our business now as the biggest trading day of the week was Saturday that’s amazing, that’s changing dramatically in some store Sunday is already bigger.

We just weren't putting enough hours into that last day of the week and we really worked on that in the second half. So tried to get same prices get a bit of return on our investments and that really helped us.

So a lot of things to be positive about in food, despite actually very challenging numbers as you would be aware. Martin will talk a bit more to our Drink business, but we need to continue to evolve it, it has been a business that's been very strong for us, it's all about actually keeping the evolution going and keeping up with customers the wants and needs and that’s led to a real continued emphasis on online in particular and leveraging digital technologies.

And the Dan Murphy’s, my Dan Murphy’s program and we just got 1.7 million members plus the whole way we think about online incredibly an important part of keeping pace with the way customers shopping liquor which is evolving very rapidly. I have talked about our portfolio, we have separated it out, we have put in right governance structures on it, we are delighted that Colin, a month ago.

Colin, I think it is, took on the role of Group Portfolio Director that immensely helpful to me, because it helps me focused my time on Food and to some extend Drinks while Colin works with Sally and Bruce and the rest of the team on the rest of the portfolio. They are equally important, but it's just about how we divide and conquer management attention.

So it's great to have Colin in that role. As I said, we have integrated a number of functions and particularly back into BIG W, but in general into the rest of the business as well.

And of course are exploring the sale of EziBuy and talked about what we have done with our improvements. My last priority and not my least priority is we have got a lot of opportunities to become a true lean retailer.

We are not a lean retailer right now. I would not confuse lean with cost, what we have been doing in the last few years and what was this cutting cost instead of improving process.

You have saved cost by improving processing is my view and that's the journey we are on. This year that’s just passed, our focus was not on actually reducing cost or in fact even improving underlying process, it was safely embedded the IT system that we were in the process of embedding, so that we could start doing that.

So understandably, it was not a year focused on cost reduction or in fact return improving underlying process. It was about getting process stability given on our new IT systems.

And I’m pleased say that actually we have made really great progress on that. Our new ERP system what we have called over there, our merchandizing platform is now stable, it's been implemented, it caught a lot of challenges for us going into Christmas and I have spoke to few you about those challenges.

It was one of the major reasons why we had availability issues in stores, but there were point in time when we lost visibility on sales and profit performance in our business. And those were very worrisome time, because retailers in everyday business you need to know everyday where you are at and we had moments where we didn’t do that.

That is now a lot better. One of my key KPIs, which was actually lasted about two weeks ago is that every store now once again gets its daily sales numbers by department and it get to gross profit by department and it gets to stock loss by department and that happens daily.

And we always used to have it, we lost it during the SIP implementation and that's unbelievably important to me so that our stores can really earn accountability for their performance. So we have really been focusing getting new systems in place.

We still have some work to do, but they are materially implemented now, not only have we been a new ERP system, but we have just replaced out payroll system with our human capital management system. That is the biggest individual payroll implementation probably entering Australia.

I'm delighted to say that's gone far less painfully than our ERP systems. But that will also help us materially and we are in the process on the back of implementing our new operating model.

Now that we have got our systems in place starting to drive and end-to-end redesign and hopefully from that we will see major performances improvements in process and of course in cost and that'll be the focus in FY17, but in particular going into FY18. So, those are my five key priorities, I have been in the role of Group CEO about six months.

We are making progress against each one, I'm not certain the progress has been perfect in every case, but the pleasing thing is that there has been progress against each one and most importantly this momentum on each one going into FY17. That's enough for me just talking about the Group.

I'll come back later to talk specifically about Food. I'm just going to turn over to David Marr now to take you through the numbers.

So over to you David.

Thanks, Brad. Good morning everyone.

I'll start on Slide 7 of your pack which is running through the Group results for the 2016 financial year. You will notice and you will have been through our reporting.

This year includes both significant items in the first and second half as well as home improvement now classified as a discontinued operation. So the total group result has gotten to the right, I'll focus on the left hand side, which is the shaded area which is our continuing operations before significant items.

So sales you can see we are down 1.2% for the year, $58.1 billion. Excluding petrol, sales were up 0.6%, earnings before interest and tax was $2.56 billion, down 35%, which is largely driven by the investments in Australian food as Brad has touched on and we'll touch on a little later.

And the consequential impact was down 39.2%, I'll cover both the dividend and royalty shortly. On Page 8, it just runs through the EBIT breakdown by business.

Australian Food and Petrol EBIT before significant items was $1.76 billion, a decrease of 40.8% driven by those investments in supermarkets that I just mentioned. As Brad said, for the first time we have split out Endeavour Drinks Group separately from Food and the Endeavour Drinks Group EBIT was $484 million, which was up 3% on the prior year.

New Zealand Supermarkets EBIT of NZD$314 million, a decrease 3.7% on the prior year, which has impacted really by investments in store, labor and increases in team bonuses which Dave will cover. And then finally turning to our portfolio businesses, we have now separated EziBuy back out from BIG W that we formally used to call it general merchandise.

You will see that's now just BIG W and EziBuy has captured in central costs which I'll cover in a second. BIG W it's fair to say had a challenging year and Sally will cover that reporting a loss before significant items of $15 million.

Hotels EBIT before significant items of $209 million, a decrease of 11%, now that include the impacts of rents associated with the sale of 54 hotels last year you will recall excluding or normalizing for that range the EBIT was down 5.9%. And finally the central overheads before significant items, which does now include EziBuy.

So I said we are at $158 million excluding EziBuy, the EziBuy lost Central overheads were $143 million, which on face value is still a material increase year-over-year, but last year we didn't pay any incentives. So there was essentially a $30 million release of short-and long-term incentives in the central overhead line last year.

On Page 9, just for completeness, we have summarized the significant items in both halves, you will see the continued operations is what we have announced to the quarter last month, which is a business-wide review which resulted in a post-tax impairment of $755 million and the discontinued operation being home improvement, a post-tax impairment of $1.9 billion. I should note that these numbers do not include the impacts from the Home Consortium’s proposal we announced yesterday, a proposal to acquire the shares of Hydrox and the reason for that is that transaction remains unconcluded and it's premature to put those into our financials and we will obviously do that as and when that concludes.

Page 10 just very high level balance sheet metrics, average inventory days from our continuing operations increased by 2.2 day to 38 days, its largely driven by new openings. We are 31 net new stores in Australian Food, 43 net new stores in Endeavour Drinks Group, but it was also impacted by lower than expected sales in BIG W and given the lead-time associated with some of the purchase of inventory that has quite a material impact.

On the right-hand side, our return funds employed before significant items at a group level was 18.5 at a continuing operations level was 22.2, which is clearly material down on the prior year and that very much driven by the decrease in earnings particularly in supermarkets given the investments we are making. Slide 11 summarizes the cash flow for you.

Cash flow obviously presented on a total group basis not a continuing operations basis. Our cash flow from operating activity before interest in tax $3.5 billion was down 25.8% and that's broadly in line with their underlying EBITDA reduction of 28%.

Interest on tax is not on the slide, but both were lowered than last year and you will see that in detail of the profit announcement. Cash flows from investing activities decreased $67 million and that’s largely through reduced property development, which is consistent with our strategy of not opening as many stores, which I'll touch on shortly.

And at a final level of free cash after dividend was broadly neutral for the year, despite obviously that significant reduction in underlying EBITDA as 28% down. In terms of CapEx on Slide 12, you will see that operating CapEx which is the second line down of $1.5 billion that's very much in line with what we said at the half $1.4 billion to $1.5 billion.

That does reflect a few new year-over-year increases in new stores and BWS in New Zealand as well as higher refurbishments. And a step up now investment in our supply and some of you will recall we have announced our first fully automated DC in Melbourne and that's some [indiscernible] toward construction of that DC.

Property development costs were lower than last year and property sales were materially higher than last year. In terms of FY17 on the pie chart at the bottom of left hand side the shape of '17 you can see the operating CapEx increases from about $1.5 billion to $1.7 billion, the total CapEx won't increase, that we still that'll be somewhere between $1.9 billion to $2 billion as we said on the slide.

So, the mix of the same will change and it's very much consistent with what we've announced that externally, so you'll see increased number of supermarket renewal stores, we intend to renew somewhere between 80 and 90 stores this year. We did 63 last year.

We'll open fewer new stores in supermarkets, we will open new stores and we'll continue to open stores where they make some sense of course where we see them being incrementally beneficial but they will be at a reduced level. So, that will be about 15 stores lower than we did this year and we'll continue to invest in core IT and supply chain and you'll see that's why those blocks have increased on slide 12.

And finally in terms of capital management, today the Board has approved the final and fully franked dividend of $0.33 per share which gives rise to a full year dividend of $0.77 per share representing a $0.70 tie up ratio of net profit after tax before significant items for the Group and which is quite consistent with our recent performance. We have announced also in our documents that we intend to partially underwrite this final dividend to 50%, that's predominantly to make the capital covenant required to replace our Woolworth hybrid, our Notes too and again details of that are in the documentation.

But we remain committed to a solid investment grade rating and we remain very consistent with the first half, we've number of levers available to us to support that position whether that be sale of non-core assets, accelerating our working capital initiatives or adjusting our growth CapEx, so they remain absolutely in place. Now, that's it for me, I'll pass back to Brad to run you through food.

Thank you.

So, just in the interest of time I'm not going to go back over the numbers but happy to take questions on the numbers. I just thought I'd rather give you a sense of what we're up to and the key initiatives and priorities going forward.

So, for those who haven't seen this, one of our key learning's was we did too much in the first half when we came back into January, reprioritized activities expressed in the form of a house and that's how we've been tracking our progress subsequently. The only reason it's a house, and this is a true story, is because the only thing I could actually type on PowerPoint myself and not rely on other sources.

It was a very modest fibro shack. However, the house has resonated unbelievably well with our team and has really become a simple and powerful way of communicating our initiatives to the team and it's something that we see really helping us track our progress over the next few years.

And reason for that is sort of really the reason for the fact it resonated was we sort of got back to this dialogue in our business and said we can't build on anything but great solid foundation and it created the right dialogue of what those foundations needed to be and how we fix them. And everyone got that in the short term of course the key thing you build on your foundations are the three parts of your customer value proposition which are around your prices, your service or your fresh and then the third thing that everyone really resonated with was the fact that these are things we can do today but we need to build out business for the future and our business for the future really around our renewal program which I'd like to talk about and how we renew our stores, it's pretty amazing exciting opportunity for us in the next few years and not only do a renewal of our just physical stores but our online stores as well.

And then on top of that what we think is actually can be one of the major points of advantages given the right culture into the business and particularly into sport and getting some engagement because ultimately a grocery store or food store is a community store and so just how you get an engagement there can be unbelievably valuable, so the heart is really originated for us since we've implemented it, it's just got great, great buying everyone in our business in food understand how they can contribute to the house and that's the most important things. So I'd like to think there is a 120,000 people working everyday towards a better house for our customers.

I'm not going to go over the detail of our progress highlights but we have worked progressed against all aspects of the house not only the foundations which I talked you to which are really around IT, but other simple things that well things you may not see as important as analysts see in our business, but unbelievably important to our customers such as our ticketing systems and you'll see a new ticketing system having been rolled out in the stores and things that I really feel passionately about I confident we was earlier, but we've opened up the front entrance to our stores and 660 stores, we've replaced there external package on whatever were 70 or 80 stores, we've just. We've put new trolleys into 230 stores just all those things that I just are really just fundamentals of running a good food business and we've seen those go in a bit longer ago and I would like the curtailment going and we've see the impact of those -- a lot of work in day 6 on the core of course it's about pricing and I am sure the questions of Australia a little bit day but it's been only been about priced very important to us has been our own brand and we have been reformulating our own brands and I feel like sometimes the first in short brand be by suggesting we get out of home brand into essentials, we're only partly through the journey, but the customers reasonable on new essential range has been absolutely terrific and it's very exciting for us we only part way through, but it's really working and it's really central to I'd say the business but only competing with the other mainline supermarkets in Australia Coles, one of the other two, but also of course making us competitive relative to all the, so we're getting great resonance on that.

We're getting a good return on our service in stores, a key point of things that we really started to learn was we haven't been training our stores sufficiently and it was real first thing our stores to training. We've really invested materially into training and stores and will continue when it's 18 and that's really helped our teams not only about giving them the hours but actually talking to our teams, training our teams and how you engage with people, how does that happen it's really awkward when you engage a customer for the first time where you figure out whether customer wants to be engaged, it's going to help people do that and that's really being terrific forth and the other thing it's been very important of course is actually started to improve our business we've got back to issue of how do we tell our customers that our businesses better and we got back to the very tangled issue of what is online brand campaign giving the what brand campaign are going to take to market and we deliberately have delayed putting the brand campaign in the market because we thought what’s the point in having a great campaign even if we could come with one if when people coming to the store it was underwhelming.

So we've been holding back but eventually we felt the store looked good enough, and our customers saw good enough to actually launch why I pick Woolworths. And we did that a couple of weeks ago and I would like to thing talking to early days really was noting with customers they look to us and say this is Woolworths, this is who we're authentic Australian brand and talked to all Australian and the data is terrific and what's great about well I think what was at the moment is while our customers are resonating with it actually so do our team because we're talking to our team as much as our customers at most point in time and so create early day resonance with that just as a great mechanic to talk about all aspects of our business, not only price, not only service but also all the services, financial services, insurance, telco's that we provide and also for ways of talking to our team and to our suppliers.

So, a real lot of pleasing progress in the quarter, I hope you've seen some of that, hope that you too liked it. And then last but not least we've been working on the future.

Our six new renewal stores, something you'll remember we did our first crack at what a new store looked like for us back in December last year in Manhattan and we're really excited about it, it's worked in part but not in total. But actually you learn more from things that don't work all that well, so it's the really important milestone for us, really worked in fresh, didn't work in groceries and so that taught us a lot.

We did our next six in June of this year and that have worked a heck of a lot better and that's been terrific for us. So, we recognize we'll need to iterate, we've done version, zero [indiscernible] we've done version one, we're now into version two and we're very excited.

But we're doing 18 [ph] renewals in F'17 plus 20 new stores, so 100 stores in the new format so to speak. And so this really sets us up for that.

There's still a long way to go but the feedback out of the six renewals has been fantastic, two things that really struck me, the first is just the limits of impact during disruption, we're much good at managing disruption, and the day the store opened, we traded above where it had been prior to disruption. That has not been true about our business.

So, managing disruption for customers given how routine grocery shopping is important and then to be ahead on day one post -- is fantastic. And the other thing of course that's worked in our new renewals as it did in Manhattan is that we really do get a pop in fresh and that's logical because fresh is where you can add theatre and a bit of excitement, and so we've got a great pop there.

The most important thing about the six renewals, we've done one in every state, we want every state to be part of that journey, a renewal for us is not only about changing the physical stores, it's about changing everything in the store including the team, their attitude and how they talk to customers. So, it's almost like a new business.

It's lights, action, let's go. And so, what we've done ne in every state, so every state is now brought into the program.

We've also built around renewals a team of closed to 80 people to now activate them as we go forward. So, great progress on that.

And I'm not going to talk at all about our Metro format but we're not unhappy with where our small stores are going it's just not a material issue in the short term for us but we're not unhappy with the last couple we've had clearly I'm sure we have critiqued our York Street store, which you can tell me about afterwards, but we're not unhappy with where it's got to and we're not unhappy with our growth in online either, well we think there's a lot of things we can do better. So, progress across all aspects of the half for us, I won't belabor the data, except to say one of our key lessons has been we need great shelf price.

That's not a key lesson, that's an obvious lesson in a way, but it was reinforced to us by feedback and this just shows you how many SKUs we've got on always on price drop. Yes it's a lot lower than Coles I might add, it's always but I would also suggest the quality of the line is as important as the quantity of the line but you can see the nice trajectory upwards and the good thing about this is the program is working so that suppliers can see the benefit of being in the program which they couldn't at the beginning like all things you're selling a dream, we're no longer selling the dream, we're selling data now.

And so, we're seeing increasing interest in suppliers participating in our price drop and low price always program, which is terrific. And Dave will talk to New Zealand which is a lot further ahead on their program in this.

This program apart from giving us greater perception with customers is unbelievably important to availability that gives you much more predictability sales which unsurprisingly as you can much more forecasting which means you could get better chance of having the product on the chart. I am not going to talk the later service much but our customers have really seen improvement in service.

And those are some of one worse in the customers course that when you document great progress on queue wait times which is nice, but I think most part of about is our team attitude despite a year of couldn’t think how negative things have been said about us in the press all kind of I became oblivious to it, but our team learned more about us from the press than they have learned about us from senior management. The moral is really held up and looked into store and I an incredibly proud about that in our customers noticed that.

Let's day on brand, this is an opportunity to put a cool picture in the deck for you for later is actually working for us, it is a different strategy as you would say out competitors, so it has a combination of not only getting the essential right on the error range and making sure where we need to be against Aldi, which we're, it's about reengineering selecting and making just our core range and the of course using some category brand in one food areas we want to forward brand to be on food product in general and not on non-food products we think that's most accretive to what officially people are. And our category brands have actually worked very well as of the rebranding of essentials still very early now in our journey only 10% of our range has been repurpose, but that 10% is performing very well.

We've also worked very hard nothing on aggregate price but on price on this range relative to our competitors. The renewals stores, as I said there has been good response we're seeing great pop on transactions sales and voice of customer and every retail on way little the magic whereof but it's been sustained and I think it positioned us very well for the future still a lot of work to do if we went into our renewal stores I am sure you can send me a list of many things that can be improved, but I'll look forward get into back and it's getting relearning as we go.

And in terms of the priorities for FY17, this was moment when you can when you can decide what are prices -- there is now new news, they're the same priorities, we're just changing the emphasis in the priorities because as we tick something will of course other things become more important, so is the same talk we just reengineered some of the things for us and price has been very important, but we are aware of the fact that we don't necessarily have the right range in every form and we need to work very hard in range, it's one of the issues that’s we believe is holding us back in particularly grocery and items for basket in grocery. And so we need to work on ranging and be more disciplined on segmentation and given the right range into the right stores.

So it's a big emphasis for us this year getting our range right which will also help the price of course because you get to open up on key lines everyone sees it. On service, we're going to continue to keep our team attitude high but we just thing we can materially improve our technology on checkouts and that's our focus.

All of that checkouts with our health checkouts or man checkouts had enormous technology improvement opportunities, we would first into go and we have off coast and off coast are slow, and actually we've got very all process on our belt to checkout as well, so we would see a great opportunity. Our team attitude is great now when you think in the technology to really fly on checkout and we'll set an opportunity on flow for those of you technically interested in that.

On fresh actually we finished the year with terrific transaction and volume growth improvement edge, more work to be done, but from May onward we decided we wanted to do the same program in meant, and we've been working very hard on meat for last couple of months and so we want to get of course, but for us right now across our business its fruit and veg and meat. And in renewals though it's the entire things, so that’s a real emphasis.

On a renewal program I think we feel good about where we are training and development that’s key. And one of thing that are under estimated that has been unbelievably important to our team is purpose.

You are all financial in this room. We all think about the numbers, but actually when -- I am really found in sub retail in particular people who working stores need a purpose above making a salary or making a bonus, why are we has been really important to the team and we have just rolled out our new purpose to meet at the brand campaign.

We bring a little good to everyone, every day and it's about good process, good food, good acts. And this is really becoming central to our cultural transformation because our team really resonate with it.

It makes them feel good, they are acting in one with it. And so I'm a numerate person myself, but I would say, in terms of changing our culture of purpose and re-estimation of above values and our leadership qualities, I think the more change quality -- culture that anything else and may will have well on new purposes, is resonating with our team.

I won't belabor them, but you can see a variant what I have just talked about in documents on those parts you have said build on FY'16, we hope we can build a momentum coming out of FY'16. But I would finish by saying we have a long way to go.

We would said it's going to take us three to five years after I feel we've made progress. I feel excited by the progress.

But there is an awful long way for us to go and that will be around for a long time to come. Thank you.

I look forward to the questions later. I'm now going turn over to Martin Smith to talk Endeavour.

Thank you Brad. Well welcome to the first presentation of Endeavour drinks.

We have often wish for this and we going to be careful what you wish sometime with. I do five minutes to talk about the Drinks Group.

And I might quickly just run through the numbers. As you can see sales 4.7% up on last year, 2% comp outstrip the market growth, so we felt we did quite well on the sales side of it.

The EBIT 3% growth has been talked to that, and mentioned I think previously that there was bonuses paid this year for influence of comparison of EBIT this year with last year. Gross margin actually increase 43 basis points and that’s an trigging one of how do we manage to get a gross margin under the same time stay competitive and so what we do with our pricing particularly in the Dan Murphy business.

It was the change in the mixing of business to do that, and it also change in the mix of a portfolio of business, Dan Murphy's, BWS, Langton's, Cellarmasters, Summergate; they all influence our blended margin in a different way and what we saw was a change there, but within the business the upside and one of the real positives was the increase in craft beer sales is starting to make an impact overall bear market. Cost of doing business, again 53 basis points up, again in some were impacted, some brought by what we did with the bonus payments which influence the increase.

So EBIT 6.38 versus 6.48 last year and sales per square meter 0.7% up. Interesting square meters themselves increase by 4% on last year.

Sales increase by 4.7% on last year. So we did increase turnover per square meter.

Some of the highlights which I try to repeat myself too much, but certainly the new stores that we opened in the Dan Murphy business, 11 new stores which change in the business that it's actually out little while and as far as growth is concerned double-digit growth in the online business and the Dan Murphy online business is really going from strength to strength and I'll touch on this and some of the highlights that I've mentioned 1.7 million customers are now part of my Dan Murphy's. We do have online business over 700 in fact 750,000 hits per week our customers on to our website that is individual hits so it's huge to send to that all of our Dan Murphy customer base is actually using the online website for the research other than just using it for shopping.

Established Langton East Asia, now this is only just stock with often official opening takes place in September so next month we have got running its bit of dry run at the moment, but it's our first extension of really of retail business into the Hong Kong market. And of course a few prizes picked up along the way, which was great news particularly for the team in stores.

When we talk about the culture and how we keep the morale up, when a business like Summergate wins the award of the Best Importer in China actually that does a lot for the team in China just as much as Dan Murphy's getting awarded the Catalogue Retailer of the Year Award that does an awful lot for the team in Dan Murphy. The focus for FY 2017 continued focus on driving growth and continue to grow the wholesale channels in East Asia.

I should mention just on the Summergate and maybe I have some questions on this one, but Summergate this year has gone from number six as far as wholesale importers of bulk wine sorry, bottled wine is concerned the number three. So we are ahead of the 18 months and we've grown up from six positions to third position.

There is still a lot of distance between us and number one I might had but this is really showing some good growth there. Launch of BWS online should happen before Christmas and that will certainly help the BWS business a great deal and 33 new stores, 10 new stores, 10 new Dan Murphy stores, 23 new BWS stores interestingly over the Dan Murphy business would get eight of those new stores opening before Christmas that should be great for our businesses it's always good to get a new store open before Christmas rather than post-Christmas.

So, highlights for the year for the Dan Murphy business particularly if you set 11 new stores. I think I've touched on most of these things.

The focus, enhanced customer experience, the network investment through refurbishment we are constantly working to make our scores better. Ever since we opened the 11 Dan Murphy stores, we've move to make each one better and the last one and along the way it has been some serious step changes on improving that.

The lowest liquor price guarantee sits at the heart of that business and what it does and I said through to it all the way and of course the convenient investment and strong team and culture and it should never been invested never be overlooked just how important that is as part of the successful business. BWS improve value perception our intention is to make the BWS business the value convenience sort of choice BWS have done a lot of work for this last 12 months to make sure that the value offer has been most competitive value offer in the convenience business.

We have also done a lot of work to improve the levels of service and levels of staff expertise and knowledge within the business. So the position themselves well for the next 12 months.

Guy Brent, the General Manager, has personally taken charge of making sure that the training has taken place across all 7,000 employees and have started to show some of the engagements scores and we are starting to see that not just the BWS NPS score but also BWS two engagements still. We'll stay focused on the bundle of the simplified what we're doing, we're looking at reviewing the actual shop front and how we make the convenience of a more convenient.

Digital enhancement we've talked about and one of the intentions that the BWS business over the next 12 month is to make sure that all BWS stores are doing click and collect, if we're going to achieve that and we hope to achieve that by midway through fiscal '17, we'll be the largest click and collect business in the country. And of course tailoring the range with any convenience offer it's important you've got what customers want and when you've got a network of 1,500 stores, what customers want in each store can vary a fair degree and what we're doing that is making sure that range is tailored for those stores.

That's a quick overview of the liquor business, I've got no doubt I'll get plenty of questions, in fact I would encourage questions, because my colleagues obviously disappointed if I don't get any, so, with having the first opportunity to do a presentation please ask me lots of question. So, I'll pass over to Dave Chambers to cover off on Countdown.

Thanks, Matt and good afternoon. Dave Chambers, Managing Director of the New Zealand Food Business.

I'll just touch, in the interest of time, quickly on the numbers, sales were strong in New Zealand up 3.8%. As was talked about at the half there was some bulk item, so that all occurred in the first half, if you exclude those sales for the Europe 3.1% across the New Zealand business.

Gross margin was up eight basis points primarily due to reduced fuel promotional discounting that goes on in New Zealand. CODB was up 49 basis points and three items to call out there, our cost of new stores across the year, the investment that we made on our core offer, particularly in quarter four, with increasing team numbers in our stores and I'll touch on that a little bit more.

And as that was really coming from, team bonuses been paid this year versus none last year was the other call out for CODB. And if you look at EBIT, if you take out the team bonuses, fiscal '15 to fiscal '16 issue then EBIT would have been flat in New Zealand year-on-year with just that issue taking under consideration.

So, a few of the high level highlights for New Zealand for fiscal '16, we continue to lower prices in New Zealand. And we are in deflation again I think for the third or fourth year in a row really resonating strongly with the New Zealand customer.

We now have 3,000 products in the price down program. A third of those were actually rolled in fiscal '16 and continuing to go extremely well for us.

I was really pleased with the work the team did around improving our customer service, there was lot of planning that went on in quarter three and similar to what Brad was talking about, talking of where our team needed more people with more training to be able to deliver to our customers. And the outcome of that is we had a 15,000 hours per week into our business focused on checkouts, long-life selling to improve availability and fruit and vegetables and they created 600 new jobs in New Zealand in addition to the extra hours the current team were able to pick up.

So, really pleased with the improvement that we had there. It was a record year for New Zealand for new store openings.

Eight new stores opened, there was one closure, two replacement stores on top of that and four new stores in the franchise business was actually a record here and we would expect in the next few years three to four new stores opening for the Countdown business rather than the eight that we saw last year but refurbishments will more than double in the next few years as we cycle over some of the stores that were rebranded as we got to the one Countdown brand a few years ago and the outcome of that and some of the other achievements that we saw NPS from capital was at 5 which was quite a significant move, we talked to the bank people what they say moving to two to three in year as the big deal, so the countdown to move up five we think was quite significant and on top of that our team engagement went up by four points as well 400 basis points if you like, but another total of four. So sales were up NPS from that customer was up and team engagement was up, so very solid year.

In term of looking forward to FY17, where we're going to continue to evolve and develop our price message and we actually have established -- we don't have a half, we're not as good as drawers as Brad, but we do have four customers commitments and so our plan is focused around those customers commitments of delivering a bit of prices, demonstrating our love for food, making things easy and being active locally. It is time that evolved our price locked down and price down campaign so we'll do that over 17, we'll make sure that we have customers lead as we do that taking action on the items that are most important to our customers.

And we do enjoy the strongest unit share growth in categories where we have good penetration of price down products. So supplies continue to see the benefit of the program and our customers are recognizing it as well.

Fruit and veg was a real star department for us in FY16, and we are planning for it to be the same in FY17. And one of the things we did last year was we rolled out a format across 58 of our stores into fruit and veg, we'll continue that roll out in FY17.

But dial up have direct grow our sourcing program and we've made some inroads and good progress in FY16, but really diving that up in 17 to work directly with New Zealand grower and it's being really encouraging that horticulture New Zealand and Federated Farmers have been a key supporters so the industry have really resonated with that program and going directly to the grower and the farmer. The other thing we've done is working on training for fruit and veg and bakery.

We roll out full training programs all 10 members in fruit and veg and bakery of FY17 and they'll impair our team so they can deliver a more consistent offer to our customers every day. We're going to maintain our strength and service offer that was implemented only in quarter four that would be a key part for us to make sure their customers continue to enjoy a consistent experience across the week.

We also recently announced our partnership with a Smartfuel they run a pretty significant program in New Zealand, they have 2 million members as part of their plan as part of their program and that was following on the heels of our decision not to renew our contract with the energy and we'll roll out a full program with AA Smartfuel in the first half of this financial year. We've also achieved last year nationwide click and collect, so every Countdown store customer can click and collect from that will give us some good growth through FY17 for online, but we're increasing our capacity and the key time that our customers want the delivery little bit to their homes.

We've only been delivering on Sunday for about the last 18 months and we've got a lot of capacity we can add particularly on the weekends to our online business. And lastly, as I commented on our session program will increase, in FY17 we did some trials on tailored ranging at the end of FY16 and every stores that's going to be refurbished and FY17 will have a tail of segmented range will do a few more stores with that as well.

And by doing that we're really improve our local offer to our customers, we're getting great resonance and new constantly store which has a significantly different range to our store just in Mangere East, which is also resonating really strongly without capital, so that program will continue to rollout across New Zealand. And now, I'd like to pass over to Sally for BIG W.

Thank you.

Thanks Dave. Big W.

This is the Big W performance over the last 12 months, it's clearly unacceptable and we are very focused on turning the business around. It's probably in line, we probably disclosed to the market a month ago.

EBIT of small loss of 14.9 million and significant I guess cost of fund employed reduction in the business as well, half of that brought across by in payments that we made the other half focused on clearing inventory in the second half since I commenced in the role. I've been in the role since January become sales performance of the business is a negative 3.3% overall.

So we hope an improve during the year, but it is still quite volatile and it was a positive 1% pleasingly in fourth quarter, mainly due to the timing of some toy sale activity that we undertook. The best performing categories in our business no surprises children's books and toys we are the market leader in those two categories within Australia on bricks some model level as well as party and men's wear.

Our mission in Big W is quite simple, it's to help all Australians to live being celebrate large for less. We have very strong heritage of low prices and value and despite we are Australians only original and orders for first discount department store in the market coming at a proud to that.

Obviously our execution has not been as consistent as it needs to be, but we do believe that we have a distinctive sensible customer positive around the widest range of quality, brands and products at everyday low prices. The last seven months, the focus has really being on very much about gaining into end control in order to maximize the performance, so I think that’s the key difference what I bring and the way we are running Big W now at this turnaround is roots and all, it's the whole business in totality, every element looking at it.

So the mission is simple, it is very much living big for less. These are the five key elements of our turnaround strategy or priorities.

I’ll take you quickly through those, so we can get to Q&A. Firstly when I got here seven months ago, I found the business is nine direct reports in over 30 people within the group indirectly responsible for the Big W business.

So obviously, a very first in key part of our strategy, I think developed one cohesive Big W team. You can't manage what we can't measure and say.

So bringing all in house all functions under Big W has been a very important part of the work that we have undertaken. And in addition just we have pointing out I think that we had many agents in outside is responsible for our product and for our brand.

So creating the centralized design team and product development team and sourcing offices is also being a very important in key change that was made to the way product will be hitting the shelves in the future. The second critical part of our strategy is to update our store network by theories of test and learn initiatives.

We are much earlier in a process than the rest of the Group here. We have got a 186 stores in our network which -- and it relative small number of lot making stores and two possible closers that we have spoken about in the recent impairment announcement.

Pending negotiation being concluded which haven't yet occurred. So once we have been through sort of series of test and learn with additional initiatives there are a good trending stores that we will seek over the next five years.

There will be two stores open this year and there is a number of other commitments that have been made prior to my coming into the Big W business but certainly we want to do a lot with the little then test and learn carefully and we've got a variety of different tests going on at the moment across our network. The third leg very important leg of our turnaround plan is to refresh the range we need to improve those style and appeal of the products and particularly in our soft goods categories and so reporting's from very talented people to help drive that and I'm frankly quite excited for our customers when that product hit stores in the beginning of January of next year.

Reducing our range is also quite important. We have over 70,000 SKUs in our store today.

We have over 150,000 SKUs in our business through the course of the year that's a lot of products that's too many products. And we believe we've got still very much of focus on having the widest range in the market but that we can consolidate and choose and more edited range for our customers to make shopping for them easier going forward.

When it comes to the W brand we believe lessons more and more rise in just price. We don’t need 27 marketing agencies and outsiders representing our brand.

We very much believe in building one highly skilled team that understands all the ways that the Big W brand comes to live. So consistency of brand is so important these days and we've made changes to every aspect of our marketing mix moving more into digital as well.

The final and critical element of our turnaround is to simplify processes and I know that sounds a little generic but it absolutely is important in retail. Retail is a team sport; things don't happen in functional silos, they happen across businesses and across so people working together.

A key principal that I had about retail businesses as I said senior management need to be very close to the customer and very close to the details of the business absolutely critical so we have taken some management legs away from the Big W business in order to drive that and certainly spending a lot of time in our stores across the country. It's been a busy six months.

We are building an autonomous business within the Group. We have brought in I'll just highlight I think it's a third point down in that first level but to give you an understanding of sort of the level of activity going on, we've brought in three distribution centers in Australia that were under Group control we had three agent sourcing officers, one in Bangladesh, Hong Kong and Shanghai, the Shanghai office is closing shortly.

We are consolidating that to the Hong Kong locations. We've also brought into Big W property legal online.

Online was previously run by EziBuy and with the warehouse in New Zealand with boarding house procurement, store maintenance, customer service functions and also elements of HR, Finance and IT and we've got plans in place to continue to over go those functions to drive the business harder. I guess if you keep this onetime as well I'll summarize I think the one message that I have today is that we've got a team now in place with full accountability and we are driving very hard I think relentless is the word that have been use to describe the impact and we are absolutely focused on materially improving the results of this business.

Thanks I'll hand over to Brad.

Not a lot more to add really. Just there's a slide on home improvement just so that you've got the detail so I'm not going to talk to it.

We're happy to answer questions of course but that's just where we stand and then in terms of outlook as I said it's very much focus on the current policies, we've to continue to fine tune them and adjust them but really that is consistency is key here and consistency of focus is key so that's the priorities going into '17, we're not expecting it to be an easy year, it's a very competitive market, it's real drive for value from that customers and we need to help them in that regards and we're not expecting an easy year but -- and it is hopefully we'll build on '16 as with time we've got three to five years. Still very early in the year, I'm not going to give any guidance, I will say that the first eight weeks have cracked broadly in line with our expectations.

On that note, I think we'll turn the floor open to questions. Your suggestion was we do questions in the room first and then via teleconference.

So, could I put the floor open to questions in the room? I'll take it and then direct it, if it's a tricky one, to someone else.

Do you want to start with Andrew?

Thanks, Andrew McLennan from Macquarie Bank. Just in relation to the guidance you mentioned there, I think that 0.3 was the comp number provided over the first eight weeks.

I'm just wondering if you could provide an indication of what that number was on a total sales perspective for food, because as we've seen, there's been a big disparity between your comp and the average sales per square meter. I'm just wondering what we can flow through….

In general inside Food Andrew with adjusted comp depending on how many stores you opening or closing, you run about a 100 to 110 basis points straight between comp and topline.

And in terms of the square meterage, great to see the additional detail, but of course it creates a little distortion in the meantime, which we'll adjust to. But can you just talk about the re-classification in sales per square meter between food and liquor and why there's something missing?

I imagine its hotels but....

So, well there's a lot of stuff that's going in there, the most important difference, I just want to call out to everyone is that we've actually gone through international standards on measuring sales per square meter. Woolworths has always had its own way of doing things and that hasn't been overly helpful and we determine to actually just use the same standards the way everyone does it, so the biggest change apart from pulling out liquor and actually measuring the size of our stores which we haven't always done inside BWSs, is in supermarkets to actually be much more definitive on the sales floor or the trading floor and inside Woolworths historically the trading floor included area behind the counters and it included the checkouts, where it's not done international standard, international standard would be the trading floors from the front of the counter and two at the front of the checkouts.

The reason Woolworths is different in my view was the property team had a KPI to maximize SLA sales area to GLA and so we took a very broad definition, it's not the standard, so we've gone and remeasured every store. So, we actually now have precise measurements for every store, so you've seen an accurate reflection on like-to-like trading square meters, so you should be able to compare them to any retail globally who uses the international standards.

The rest of it is just put in some more precision back into the business but that's a major change.

Could we also request the half year numbers if possible?

Paul, you got the slide, okay sorry.

Yes, I could give you those half year numbers.

Afternoon Brad, Craig Woolford from Citi, just wanted to clarify the gross margin outcome or outlook for the business in the release you said there's AUD500 million was invested price and if I do that divided by the sales base about 140 basis points in the same release it also maybe got the gross margins are down 170 basis points in supermarkets, I am trying to understand the difference there. And then I am clearly lost the goal of different sequencing of price investment over the last 12 to 18 months.

I would like to know what the incremental price investment that just got annualized going to FY17 into the market.

The instrument product adjustment is what we called out is the 500 million in other words we started investing in 15 so in 16 we invested $500 million on an annualized basis, it'd be close to double that.

So Another 500 million coming in FY17.

Well, effectively 500 million in 16 is on top what we've already done in 15, so it could start to rapid where we're going to be talking what was done year-on-year. So $500 million and to your point on the margin, I mean there is a number of things that impacting the gross margin as we have talked during the past clearly major price investment, we've had stop loss deterioration which we talked about associated with system changes we sort of stop losses not where we wanted to be the big opportunity there.

We also said we were facing immaterial cogs inflation particularly in needs so those were three things that we go against it. Once we get the margin at a total level when you think you got food and petrol include petrol and given the swing away from petrol because of the Caltex alliance change, there's a material mix improvement that goes for you, by virtue of change, which we don't get going forward because we've now lapped there.

But the gross margins for supermarkets were quite separately -- gross margin for supermarkets are just 178 basis points.

And then BIG W and we called out twice now helped the fourth quarter comp, any clarification of how the business is trading post year end?

Yes, the comps are still volatile so this was our first positive quarter I think since September 2012 in BIG W, so we've got few views to really gain problem in terms and we're not expecting too much as the moment from comps because of the pull backs of toys and ships between the two months but also because we're cycling and clear inventory that we will be leading from the range going forward given that need to bring the range which down significantly over the next four months prior to Christmas.

Just a question further on the point for us obviously you share prices are running because positive comps, can you talk a bit about have you have had -- have you initially, how much dollars you have -- how many dollars have you actually invested in price sorry you've spoken about 1 billion dollar I thought you did 200 in the second half 15 and then you've done say 500 into fiscal 16, so should we see an incremental 300 coming through in the early part of the fiscal 17, so I just very curious to get an idea of what dollar number have you actually invested in price, please?

Over what we did 15 an additional $500 million, so that will -- because of that in second half you'll start to be able to see further in the first half on an annualized basis between the order of 1 billion.

And maybe you can give us for a seven-week, have you availability improved relative to fourth quarter which was also an improvement and has the price investment stepped up at all, or were there any other sort of factors obviously but bit have been relatively on demanding comp as well, just curious about what's going on in this first seven which is very important, what's driving for us today?

Yes, I would emphasize by the way the numbers you're quoting Shaun, are the first eight weeks and eight weeks doesn’t make year, as you well know. Just on availability, actually we hit our best availability in two years two weeks ago.

And I am quoting two measures for availability there. Outbound service level is consistently 95.5 and then our PI integrity where we basically ping a store a number of times a day and product was in the store, doesn't mean it always was on the shelf that kind of true that it was it there.

That's got up to 96, 67. Both those numbers, if we go back over few years materially better than have been.

And both of those numbers actually aren't adjusted for range free eggs which is a big supply issue, if you're not up to date sitting. So we have made really good progress.

Still a little bit more volatile than we would like, but actually we are getting into a nice loop where, we are getting inventory levels down as well as getting the availability up, and that’s really want to be. So we are not holding this one year, but we are feeling a lot better on availability and it's the best as I say in loss as we've seen.

I still get frustrated on the top 20 line and that’s really my priority for me and for the team these 20 lines we should never be out of stock. And unfortunately that's not always the case.

And there I worry about proprietary bread; in some line there. We have got a -- to DST supply we need to work better on, at times, not to the same extent Coles has had at Victoria with milk lines.

So I am feeling pretty good on availability. So the second half of your question was just what are the consistency we are seeing --.

[Indiscernible] whether or are any other factors that are going on that have actually contributed to the sales, that you that you've enjoyed right so far.

Well, modestly increase that we have enjoyed so far. So look, I mean I think we have a bit of -- probably had some benefit in Victoria with the issues of Coles has had in milk.

Clearly that had a number of issues in this small customers, came back to -- it caused stock out issues in our own stores, which is distressing because customers will. But that’s I wouldn’t called that not was an individual factor.

I think it would be fair to say, across the industry, that, with the deflation increasing that we have seen great sales and we have all enjoyed that, I think that’s important. But I wouldn’t neither those factors that would, by themselves, explain the situation.

In terms of pricing specifically, what I would say is we have been very consistent our competitor has not. I think that would be what I would say.

We have been very consistent, we have banished in our business, diving for the line in June. And whatever we are trying to drive, consistency and rhythm.

Thanks. And just a -- I guess a question in terms of within food is the focus sales growth or is it margin?

Because we are actually getting interesting feedback that things like prices dropped and always are actually not in enhancing for Woolworths and it appears to be somewhat of a disconnect where there is buy [Multiple Speaker].

No great question, I think that was cold out in our announcement. We have a lot more work to do with our supplier relationships and getting consistency of message cascading down through mine.

We have seen that on surveys and the surveys that got to done. So it's an area of consistency for us.

We are back in sustainable sales growth at times that message and the consistency, when you've got 100 to 200 buyers hasn’t cascaded down to all suppliers. And it's a big area of work for us going forward.

In fact we have got to the point of having earn monthly as far I'm aware of the enormous opportunity we have for improvement. Specifically on how we think about our EDLP lines, low price always or prices dropped, what we don't want those lines to be is decretive to margin so we want to open up and everyone have a sell a whole kind of this but virtue one of the careful is that isn’t decretive.

The aspiration is not for it to be accretive, but we don't wanted to cause us an issue so that's what we were assuming.

And just finally for me, just in terms of you spoke about CODB. You didn’t previously the Company had engaged in cost reductions that had been effective and you are focusing on having the right process with the right process is there actually on opportunity for you to take cost out of this business?

Given the deployment of 500 the removal of 500 people, people going back and it's into the businesses. Can you actually takes it down by doing things better but ultimately enhance with this cost?

There is no question we can improve that trend cost in all of that co-processes and this will not be a big year for us doing this because we slip so much work to get stability in process and getting systems and contentions but again as we called out in the document we do think that there is a major productivity dividend rule get once throughput all of our systems working where there should I mean I don’t want to get into the technical details with one and we have implemented which is a change as the whole why we manage our front ends and our cash office and our ticketing we have enormous benefits to us. As some of the work we are finding with just a whole way we manage replenishments in grocery so we started I think it's a multiyear journey that.

Thank you, Brad. David Walker from Clime Asset Management.

When you say this is a three to five year turnaround, could you help us understand why you say that and where you think Woolworths could be after three to five years. In terms of some financial metrics what you have been to achieve after three to five years?

It's a great question. I think I'm not going to get into the metrics overall it's fair to say we do as far and need to be become again a sustainable growth business one that has balanced between the top line growth for it.

How much we delivered to our shareholders and how much we delivered back to our customers and we just want to get that virtual slip working again for us that's the goal to do that eluting to get back to a sustainable same-store comp sales because most of your cost at the end of the day give or take have driven our store levels so you would got to get stability there so we are very focused on those metrics why you said long-term and that's the goal over three to five years and it's hard to be precise on the years because as all time in my experience I was up to can move more quickly than we could and we are doing that actually just have unanticipated consequences that you really think yourself on side. We have not finished the first year in that journey so I'm kind of excited to be in the second year actually.

I can't tell you where there will be there after three or whether will be there after five. I think the question at the end of next year.

Thank you and on [Indiscernible] has been top and competitive for a very-very long time. Why does we won't in this business we can see the turnaround in making it looks good but you are leading competitors are also strong and sales incentive and [Indiscernible] why is what were I think challenged prudent a better risk adjustments and on the capital efficiency in this business elsewhere?

Look I guess I think it's a really if you don’t mind we are saying it given where we also had seven most offer U.S. activity good question because we are in the business, we have commitments to our teams to at least supplies we need to get the business into some form of profitable growth and then we can say that the question that you are posing but giving where we are now it's all hands to particular of just getting it back to some stability which we believe we can do.

And we don't think is -- it's very different business where you got a 3% EBIT line against it, never mind 10 or 12 is I think Sally would know and so that's if I just -- pass it on now.

[Indiscernible] question, we'll take one more from the floor and then we'll go to the teleconference if that's okay.

Bryan Raymond from Citigroup. Just on your renewals, you talked about transaction growth of 9%, you've got broader transaction growth of 2% to 3% in recent quarters.

So, I just try to understand first of all if you can give me feel for where sales growth is in those stores given you're talking about fresh and basket size that should be above that number, is that a fair assumption? Can you give us a number [indiscernible]?

It will be in line with that number I'd say Bryan. I mean we've got eight to nine weeks of trading so -- pardon me, so, it would be in line with that number I would say.

And then cost of refurbing a store in terms of the CapEx and maybe?

Not happy with where it is yet, but to me a lot of what we do in is from R&D element and one of the issues I've learnt in this process has been we used to refurbishments and say well if they don't give us a return we -- that's how we got ourselves into a little bit of a current situation. But what we never did in those was push the boat out far enough to see what could pop for us and so I don't think we're in an R&D mode and I think I mean David keeps me honest on this one I suppose.

I still feel like we need to overspend in some instances, just to see what's possible before we cost engineer ourselves the renewal because if you use the cost engineer up but you got to know what you're trading off and so we're are overspending and dare I say, to this stage, deliberately just to know where the trade off or where the inflection point is in a great meats departments, in the great make-your-bread [ph] base bringing the magic back into bread. So, I think we really need to push the bolt out in deli, I'm not happy with whether we really challenged ourselves in what a great deli looks like, so we are overspending, I would like to think that we will really pull that back in the second half of '17 and certainly divert -- and the team will be really challenging us on that incremental spend.

But we're going to know what's possible, that's been the issue?

And then just on FY'17 roll out, in terms of like obviously you talked about Version 2, you've got six trial stores now on Version essentially, what differences do you expect to be in the 80 or 90 be around next year versus what you've got in the six at the moment?

But weren't maybe aware, I don't know who's been to all six, if you have I congratulate you for your diligence for efforts, in fact every one of the six has slightly different elements in it so they're not the same and so they're interesting things we're going to pull together from the current six, because different things are working in different parts. So, that's step one.

And then step two is really pushing the envelope and in fact what Dave and the team have done in New Zealand we think that they've landed a really terrific store for us in Ponsonby. So, we're taking a lot of elements out of the Ponsonby store in New Zealand.

So, we want to pull those, and we want to take the learning's and team has just got back now from a full review of what we've seen in the U.S. so we've gone over -- I didn't want the team to go to the U.S.

until they had practically grounded themselves there but we've just done that now, and I'd like to think we're going to cherry pick the best out of what we think is the better retailers in the U.S. In terms of areas for us we found east/west on health and beauty and I take -- you know the Mount Hutton, you've been up there.

It doesn't work for us, not just on the system like it, in a refurbishment, it might work in the new store, the theory is great, just doesn't work because people don't like their cheese removed routine the changed things in apparel so we will definitely be changing there. We think we've got a lot of work to do in health and beauty, we're not happy with the way health and beauty pops for us as at all.

I think there is a lot of work to do in fixtures and deli. We're really happy with making grading metric and so we really going to be working very hard in that some, so our color is a lot actually not one which is retail as everything thing.

And then one more in, one to like for like acceleration from the negative 1.1 to 5.3 what we get today instead of new transparency you got around transaction market size et cetera and is there, don't expect that number but would you us dimension what changed in that 140 basis on acceleration core sequentially?

Transaction growth has accelerated.

Transaction growth is driving -- and then we'll turn up to the air, if that's okay, I think we do this clearly embarrass I don't, if you can read the question I am going come though okay.

Hi Brad and the team. Just a question on the price deflation we're seeing across the industry in the fourth quarter.

I'm wondering if you can maybe break out the components for us a little bit in what was maybe attributable to produce, which could be a bit transitory in nature versus maybe what you had to step up in price in South Australia and Western Australia?

Thank you, good question. As you know one of the reasons I was very keen to pull tobacco out, and I think tobacco is incredibly distortive on prices, which is why we shown you including and excluding tobacco.

In terms of the excluding tobacco number that we got there classification for produce I think in the last quarter and Paul you can correct I am wrong, it was running close to 10% so we've obviously had very big deflation in produce. We would expect to see that is in the share and we started to see a little bit of the easing in the first few months well that's very early and very moderate.

So that's being a major driver of deflation. The other drive of deflation has been average prices in grocery, so grocery has been relatively not quite as big not nearly as big, but it's a big part of our business as product, so produce was the biggest it seems something we can glossary seen a little bit in the Chile.

During merchandizing it's actually had a quite a lot deflation but I think that's our battle with that one to go because its' hard to thinking about the numbers and adjusting. And then for us any way we've only had very moderate price increases in meat I think from a number of other retailers you'll see quite large prices inflation in meat that’s because we felt we really want to be price on meat and have been very proactive on trying to hold pressure back on the increases on last food prices in Australia.

So I think grocery is the one I'd suppose and was called out by our competitors being more deflationary than has been historically true.

Thanks Brad, that's helpful. Maybe just a quick one for David quite a few of the teams called out that bonusing is increasing this year, and just in relation to the central overhead line, ex-EziBuy and that increase in bonuses, is that the level we should expect going forward, or as you start to see business improvement, that will tick-up as well?

Yes, I would, Adam, as a starting point I would say somewhere between 140 and 150. Remember of course this just not just about central overheads.

This is any costs that cannot be directly -- should not be directly allocated into one of the businesses. So it's is -- it is sort of the catch if you like.

We have tended to say start at about 150 and I would probably still recommend starting around that point.

Great thanks.

Good afternoon Brad, good afternoon David and team. Yes, very pleasing, Brad, to see some good news coming out of Woolies.

It's been a while. Two questions; my first question is, looking at your 4E data -- your 4E, Page 6, you give quite a lot of good data on the Australian food operating metrics.

And it looks as though, in that fourth quarter, things really started to gel for the business. Your volume productivity jumped sizably, from 0.3 to 1.5.

This is the fourth quarter; this is excluding the first eight weeks which you're saying jumped again. But looking at your overall customer satisfaction, it really jumped from 68% to 75%.

Other things -- you were saying that your staff engagement really picked up as well. My first question is what happened in that fourth quarter?

What is a come-to-Jesus moment where the customers just realized all this hard work that you just had to go through this period, or did you do something different that really resonated with the customers? I'm trying to work out the sustainability of this going forward and the momentum.

Can it continue going forward, because the fourth quarter was, on these metrics, terrific? And the eight weeks is terrific.

But clearly we want to see this continuing. So I'm trying to understand, was this just waiting for this to come through; you needed to be patient, you needed to back what you'd done, or did you do something different in that fourth quarter that really did work?

No I think it's a great question David. I was asked in the media call, what's the three big things we have done a lot in second half and my answer was, consistency of approach and is one, two and three and I think that true.

We had a business where we came out with the new strategy and would to say a number of people sat on the fence and said [indiscernible] change and we will pass all this on a same and see what happens. And this isn’t about me personally, but when I was pointed as the group CR and came back to the team and said well the strategy isn’t going to change.

It's not someone new is going to come it's not going all change again I think it gave us an enormous benefits. So it wasn’t about new person, it was just about the business getting and our teams getting to that, we are going to stay with what we had.

And so I think everyone more bought in than I’ll, I just think everyone realize it's not going to go way -- I am not go away and someone else is coming and talk about something else in customers they got us. So I think that’s just takes a long time for these things to seep down to stores as we have talked about earlier.

And I think Shaun called me on this one and Craig, if he was implying but as well we haven't found the same consistency with our suppliers yet. And in terms of insight about us but it's just in big businesses just consistencies are essential.

So that’s what I think it is to be honest, and the team gets it. And I like it, because actually, you know, if you're in retail who doesn’t want to make customers, I mean it's a last message and so it's kind of good, it's easy to energize people around a message like this.

Can you tell us what those numbers were -- this is part of my first question, not my second one. My second one is on your wastage costs and when are we likely to start seeing that release given you're on top of your SAP problems.

But can you give us an indication as to what your overall satisfaction was in that first eight weeks from the 75% in the fourth quarter, because I gather it's picked up even further? Is that a fair comment?

You said it hit 80% or something, didn't you or was that what you said?

The one that's hard to move is overall customer because that but the store contrivable one I one of the store impacts our second number which I think we finished Q4 on 77% we are running that 79% low how do we lost if you can check hold out which was 80%. So and our target of the team is 80% just to be honest with you.

Because we feel we now think it was at 100% but to do one 80% of your customers to think it's a great experience overtime.

What is the world's best standards, Brad, what would be the world's best retail of everybody?

I actually do not take the customer necessary I actually don’t know to be honest with you let me take it another. I think it's quite high than we are I think if you give us some of the major for Dan Murphy with from that probably at 90%.

I would tell you that our best stores are at 90%. So, but the issue direct for me is one what kind of still get to record a renewal where the renewal store or a new store we can hit 90s is now a question it's really you convert in an also extra that's the tough but.

That's the management add.

Yes, because the worst thing about the new stores as we know we get a 1.1 meter it's not as big as easy it's basically lot of things there just at 2.1 and so the changes but let me think for the moment.

Okay. Well my second question is on wastage.

Now this has been a bugbear that is in your gross margin and was your systems were a big bugbear. You look like you're now over your systems, given the chart that you've presented, or you're certainly on top of it.

Hopefully that improves your availability, but when I think you called out that wastage costs are about 400 million over and above what they should be. When can we start expecting to see some of that come back, so that you can either reinvest it or you can start giving it back to the shareholders?

When can we start expecting to see it?

No, I think it's a great question. We and its related to the question around GP actually because there was material changes in soft loss which is wastage calculated with included between H1 and H2.

So we really hit a very big piece I think at the end of H1 and we really pulled the number back over the course of H2 but in particular as we exited June so we are more than happy with the run rate that we've improved on four F-70 but obviously there were lot more work to do to continue that improvement what we've try to do have over as we do waste some of the balance we tried off between it's easy to reduce stock loss if you but you can really the great quality of fresh fruit I mean you don’t want to through it away you can sell it someone and that goes bad stock loss and we don’t want to be in the business of selling things that we are not happy with the customer so we've pulled the cost of fresh program and it's really not it's working well tracking to schedule we are not going to did moves this practice in F-17 but we will be there by the end of this 2018 but we will make a material jump in 2017. So we are actually very pleased with where it is right now.

Afternoon Brad and team. I've got one question on the calculation of the food comp around the world, all retailers include cannibalization, new store cannibalization for their comp.

Are you still excluding the impact of cannibalization from the comp?

No, I mean Tom one of things which we look at that is part of that accurate this is the one that you were leading to which is number we are working towards and no the adjusted competition is the same way so it's always been done so you get the comparison and we just felt at this point giving you the comparison was a key effect. It is the way it's always been done but at least it is consistent with all the history that you’ve got.

Just restating the history to do like for like is a big job side.

I thought you’re going to the global standards --.

Right, our journey to the global standard that’s how I am doing, but --.

And so how many stores are in the current number? Is it half of the network, is it 80% in the network?

It's well over eight.

And then following on from Andrew’s question, I think you mentioned the spread from comp to sales growth. Is it bit over 110 to 120 bps, so if space growth is growing at 4%, why is it that you see difference there in spreads versus the space growth?

So for whom you’re talking about the space growth to the adjusted comp and for. Well, let's the question and that is full year and the other ones, David?

So Tom space growth grew about 3.6%. I mean the critical difference here is obviously our comp sales and our total sales reflects the heavy business we’ve made in price.

We haven’t yet seen the uplift yet. I mean that’s the key also so that’s looking back if you like.

What we have said looking forward is we’ll be rolling out less new space clearly. So we’ll be doing partly with new stores going forward.

We said in July that would be I think in the order of 45 stores over the next three years, which is I think less than half of what we had planned to do. So you will see the new space increase start to fall away.

Thank you. David, could you perhaps expand on the balance sheet, particularly from a funding perspective.

You did mention the redemption of the Woolworths notes, but I think I guess what I'm getting at is with the fixed charges cover ratio at 2.3 times you're going to be constrained in your ability to issue debt that requires a credit rating. So could you talk generally about the balance sheet and funding please?

Sure Grant, no problem. So, firstly I should just clarify that fixed charge cover ratio is at a total Group level.

It does exclude significant items but it does include the discontinued operations. So on a continuing ops basis, it's actually about 2.42 times.

So, we probably could have made that depiction on the page. But to your broader point I mean obviously our funding frame work is something we talk about very often.

We’re very focused on maintaining a solid investment grade credit rating. We believe we’ve got only this in place, the biggest by the way is clearly underlying improvement in our operations that is by far the biggest opportunity we’ve got, but we’ve got other opportunities we talked about.

But the logic part of the way of the underwriting of ERP [ph] it does give us some flexibility around investing as we need to around accelerating the refurbs and IT spend but it's predominantly on the back of lease financing the hybrid as I talked about. And why they probably works is you either have to refinance it with a similar instrument and equity or straight debt and equity in equal proportions.

So using the ERP from the first-half, the take up was about 31% we assume the similar percentage this time that we would be slightly short of that and therefore we wanted to underwrite it which means through a bit dividend, the dividend is we looked very carefully both historically and looking forward around sustainability of our dividend approach. You will know that we tended to pay about 70% payout ratio.

We think that is a sustainable level that free cash flow should generate and we should generate enough free cash to cover that without use of much of property sales an example with the one exception actually of this year of 17 because one of the things we're doing in 17 is we're increasing the investment we're making particularly around core IT infrastructure in stores with fixing a lot of things it's going to cost us a little bit more and that’s they operating expenses is going up, operating CapEx is going up. And therefore that's the one year where we may continue to look at property sales as a way of balancing that out, but it's an area that we're continuing to focus on growth and with the Board for obvious reasons on an ongoing basis.

A question, if I could, on Big W. So I think as I understand, I guess, the shape of the profit line over the next 12 months will be further gross margin impact in the first half, as you clear some of the legacy stock, that you won't be ranging in the future.

And then as we move into the second half, you should have the sort of merchandising range that you desire going forward, so perhaps you could confirm that type of expectation. I guess one element that makes me a little nervous about the structure that's been put in place is my understanding is sort of like -- not like, but a dual role with a designer and a buyer working together.

And I guess my question on that type of structure is if a product doesn't sell, who's got accountability for it? Is it the designer or the person who's bought the stock?

That's brought a number of these type of businesses undone over time.

Right, I'll answer the first question. The latter part of your question first Grant, I think the buyer is the head of the business and he's responsible ultimately for the decisions that are made and what products have chosen, but obviously they need to be I believe to get the right results, some tension between that relationship between designer and buyer.

So the design that is provided for the buyer to choose from comes from the brace that the buyer gives the designer, so those buying and design teams are separated and they head of each reports to me. And there should some tensions, I am happy with that that's very common across global apparel businesses such as H&M, Uniqlo, Topshop, et cetera, it's very common, it's not as common in Australia because Australia has been a derivative product market copying northern hemisphere design that's getting harder with the northern hemisphere actually in our market now and watching the product that's coming out by local retailers.

So we're in business in BIG W to have original designs rather that copycat product, so I believe the structure is the right now. And the design team leads the results to across online and marketing so makes that a very cohesive sort of looking seal not just the product design element.

So hopefully that helps your nervousness, definitely the buyer is the in control of the numbers of the business and the business divisions. Just to go back to what you said in the initial stages, you know what's my thought around growth margins for BIG W going forward with the sky is the limit, but I think it's very early day, so we are not getting guidance on that and we are scaling up the amount of products that we getting directly from our own factories or from factories own by other but without any middlemen or agents involved.

And we won't be at 100% direct source own brands by the end of 2017. But we will be much closer than we are today.

So there should be improvement in gross margin, but there is also I think a bit of work that we are undertaking in Big W to understand what exactly should be in gross margin to give us clarity on what our retail trading profitability is versus some of our vendor income around marketing. And I've got some very interesting thoughts I guess around the way we can drive the business getting clarity to what the raw retail trading result is for each categories in that managers around those categories.

I am just cognizant of time. We might just go might just go to the last three questions, if that's okay.

Good afternoon, everyone. I know this has been talked about already, but I just wanted to talk a little bit more about the phasing of price investment and how we should think about that into 2017.

I think you said previously there was about 150 million incremental investment in fourth quarter. So I guess, has there been any more incremental investment in the first quarter?

And if not, does that mean on a realized basis in FY'17 versus FY'16 there's going to be another incremental 450 million, so that 150 million over three quarters?

I might just take that offline, Michael if you don’t mind. And effectively what we try to do today is we talked about what we invested in '15 versus '15 and we told you when we started in '15, since then we've invested a further 500 million.

So, on an annualized basis that is in the order of -- probably $24 million. So just need to have because we had the same question from a [indiscernible] and we are look at how these further articulate that for you.

Okay, all right, that'll be helpful. And then, it's great to see the disclosure on the liquor business, I was just hoping you could give us a little bit of color around how the like-for-like sales growth and margin have trended in that business over time.

It looks to me like growth used to be a little bit faster and are margins close to peak levels, or have they come back a little bit over the last couple of years?

Michael I’ll answer that question.

Thank you Brad. So thank you Michael.

The growth within the liquor business, no doubt that the Dan Murphy's business is the engine highs of the liquor business, the other particles of the BWS, BWS in the last 12 months it's growth has been slow but it's still positive growth and is gaining more momentum, and I’ll say that it's going to get a far better value offer than they may have 12 months ago that actually starting to show good growth across the BWS business. But it is squeeze to watch timer of business, no doubt about that, that that is the major, if you like, power house of what's driving the liquor business.

Martin, the point I would add, if we could and we can do better job of measuring deflation. There is still quite material deflation in the liquor market and particularly in the white wine category which has been very different which is quite a large part of our business.

So you going to see the numbers in the context of -- it's quite hard in a way to do corporate same analysis on deflation. But they are quite as certain in the short-term and is quite materially threshing and [Indiscernible].

And I guess that it's what changed over the last couple of years as we've seen a reduction in little consumption mostly driven by a reduction in VA consumption that's probably leveled off but and were seeing that picking back up off of the backward class the craft B of sales although they are still small comparison to commercial sales are gaining significant momentum the challenge you have in that process of business of course is this 300 or 400 different crack fields versus half of dozen then the commercial deals so the cost of doing business involved in selling craft is higher in the cost of doing business involvements that are commercial so you expect to see improve margins in that side so it will the numbers of little bit for us but I've got no doubt that there is still a lot of upside on the BSI driven off the backwards craft.

Thank you everyone for your questions today. We are just going to talk to an issue it seems like few people having move make sure we have a process to very well you will be wanting that half on half splits for full fruit and as you do modeling.

So one others call out that for you of the Australian fruit and picture FY 2016 results this could be in the second half and obviously the first half is about Australian fruit in the second half was $16.6 billion, petro was $2.1 billion and that totals $19.7 billion. EBIT which is was $805 million, if I turn to endeavor of the $7.6 billion of Endeavor sales, $3.4 billion were in the second half and it was approximately $190 million of EBIT in the second half.

Thank you everyone for your participation today. For those of you in the room please join us for the Woolworths lunch outside.

Thank you for your participations and your questions.