Australia's biggest retailer, Woolworths Ltd., on Tuesday said its first-half net profit rose 28 percent. It also outlined plans to increase investment in its stores.
Woolworths reported a net profit of A$891.3 million (US$823 million; euro555 million) for the six months to Dec. 31, up from A$695.6 million the year before.
The result came in above analysts' expectations, and the company's shares rose more than 4 percent higher to close at A$30.23.
Woolworths said it will increase capital spending by 40 percent this fiscal year to A$1.8 billion (US$1.66 billion; euro1.1 billion), accelerating the refurbishment of its supermarkets and Big W discount chain.
The retailer is reinvesting profits back into the business, including reducing grocery prices to keep up the pressure on lagging rival Coles, which was last year taken over by conglomerate Wesfarmers Ltd.
Chief Executive Michael Luscombe said Woolworths continued to gain market share in the first half over Coles, but cautioned on the outlook given the prospect of rising interest rates, fuel prices and global market turmoil.
"We haven't seen any downturn to speak of to be quite frank ... but we are yet to see the full ramifications of what is happening globally," Luscombe told reporters.
Group sales for the six months to Dec. 31, rose 8.6 percent to A$23.9 billion (US$22.1 billion; euro14.92 billion), from A$22.2 billion a year ago.
The retailer reiterated its full-year forecast of a 19 percent to 23 percent rise in net profit.
The company declared an interim dividend of A$0.44 a share compared to A$0.35 a year ago.