CEO Brad Banducci has cited poor performance and a failure of business synergies being realised as factors behind Woolworths looking to offload the catalogue clothing and homewares retailer.
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WOOLWORTHS says 500 jobs will be cut as part of a major overhaul of its business.
The supermarket giant is also set to permanently remove 500 roles from its support office and supply chain.
A decision to shut underperforming stores and defer the opening of some new outlets will cost the grocer A$344 million, while the implementation of its new strategy accounts for A$155 million of the total pretax impairment.
Ezibuy was expected to report a loss in the year to June 2016 of A$13 million to A$18 million and Big W a loss of A$12 million to A$17 million, the company said.
The company also owns Countdown in New Zealand.
Mr Banducci said since taking the top job at Woolworths, his goal was to have customers put the supermarket first, improve culture and “rebuild momentum”.
“Today’s announcement demonstrates both the progress we are making and our absolute commitment to act quickly to rebuild the business by doing the right thing by our customers, shareholders, team and suppliers”, he said.
The company closed three stores, including one New Zealand Countdown supermarket, in 2016 and plans to close 30 stores across its portfolio, of which six are Countdown supermarkets.
The company said its earnings before interest and tax from continuing operations, before significant items, would come in between A$2.55 billion (NZ$2.72) and A$2.57 billion (NZ$2.74) for the year.
“These costs primarily relate to the planned store closures of underperforming and non-strategic stores as well as the deferral and exit of non-core property development assets in line with the revised property network plan”. 45 and have dropped 8.4 per cent this year.
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Online retailer Ezibuy would be separated from discount department store Big W as part of the restructure, and the company said it was “exploring options” for the sale of Ezibuy.
