The Woolworths Group Ltd (ASX: WOW) share price is on the move on Wednesday.

In morning trade, the supermarket giant's shares are up almost 1% to $31.80.

This follows the release of the company's highly anticipated half year results.

Woolworths share price higher on half year results

• Sales up 3.7% to $35.9 billion
• EBIT down 14.2% to $1.45 billion
• Net profit after tax down 20.6% to $739 million
• Fully franked interim dividend down 17% to 39 cents per share

What happened during the half?

For the six months ended 5 January, Woolworths reported a 3.7% increase in group sales to $35.9 billion.

This was driven by a combination of solid sales growth across the company and the acquisition of Petstock. Excluding this acquisition, sales would have been up 2.5% over the prior corresponding period.

The key Australian Food segment delivered a 2.7% increase in sales to $26.7 billion. Management notes that solid trading momentum in the first quarter was partially offset by the supply chain disruption driven by industrial action in the second quarter.

Excluding the estimated sales impact of $240 million from industrial action, first half Australian Food sales would have increased approximately 3.7%.

This action also weighed on Woolworths' earnings during the half. Group EBIT was down 14.2% during the half to $1.45 billion.

This was driven largely by a 12.8% decline in Australian Food EBIT. Management notes that without one-off impacts, its EBIT in the key segment would have only declined by 5% year on year. This decline was partly due to a gross margin impact from higher meat input costs and a customer shift towards lower-priced items and more deeply discounted specials.

Elsewhere, Australian B2B EBIT increased 9.9% to $78 million, New Zealand Food EBIT rose 13.2% to $73 million, and W Living (BIG W, Petstock, Healthylife and Woolworths MarketPlus) EBIT lifted 2.8% to $15 million

On the bottom line, Woolworths recorded a 20.6% decline in net profit after tax down to $739 million, which forced a 17% cut to its interim dividend to 39 cents per share.

Management commentary

Commenting on the half, Woolworths Group CEO, Amanda Bardwell, said:

Customer metrics have begun to improve following a challenging half which was impacted by industrial action and ongoing cost-of-living pressures. We remain committed to providing value to our customers in an environment where household budgets remain under pressure and customers continue to shop around.

Our priorities for 2025 are clear and we are already underway. We have an opportunity to further improve the shopping experience for our customers, we are taking steps to simplify our business, and are committed to unlocking the full potential of the Group.

Outlook

Management revealed that Australian Food sales were up 3.3% during the first seven weeks of the second half. This has been driven by a more stable trading environment following the recovery from industrial action, cycling lower growth in the prior year, a collectibles program and ongoing eCommerce growth.

New Zealand Food sales are up 4% during the same period and BIG W sales are up 1%.