ble it’s been since WHL acquired it”. However, Bagattini said that while it was exciting to see the business trading well, he stands by the decision to sell David Jones to equity firm Anchorage Capital for an as-yet-undisclosed value. “If you go back not that long ago, this business was not doing very well, and as we went into Covid we were potentially staring down insolvency,” Bagattini said. “We put our plans in place, restructured the balance sheets, and it’s really come [good]. “It’s cash generative, it’s self funding, and is well set for its next phase. Anchorage Capital is picking up a good business, but it’s a win-win.” As part of the deal, Bagattini explained, Woolworths Holdings will be able to wipe $1.8 billion (22 billion rand) worth of liabilities off of its balance sheet, and will be able to better focus its efforts and investment on more profitable businesses in its portfolio. Beyond delivering a strong result, David Jones also announced it has agreed to an enforceable undertaking for around $1.9 million in underpayments – although the Fair Work Ombudsman said a “large majority of back payments had already been made”. The acquisition of David Jones is expected to be finalised by the end of March. The (Country) Road ahead Woolworths Holdings will retain ownership of Country Road Group, which includes Country Road, Mirco, Witchery, Politix and Trenery, and it has already started separating the business from David Jones. It recently extended the brands’ reach by launching them in department store rival Myer. According to Bagattini, Woolworths Holdings will seek to further grow Country Road Group, both in terms of where its products are carried, who it targets, and potentially, by adding new brands to the lineup.  “We think there’s a significant runway for this business,” Bagattini said. “We have the opportunity to continue to expand distribution into parts of the country that it’s not present in today, and to get access to customers that we don’t typically access. “[We] have a very talented leadership and management team in place, and several growth opportunities lined up. It’s an increasingly important part of the WHL group.”  Additionally, Woolworths will retain ownership of David Jones’ flagship property in Bourke Street, Melbourne, and lease it back to the business. Bagattini said Woolworths Holdings has received “extensive” interest in the property, and while it is in no rush to sell, it would consider parting with the property given the right timing and price.  “It’s been a painful journey for WHL as a group, and for shareholders, and I think the work that we’ve been able to execute over the last three years, the turnaround of that business, we’re very pleased with. I think this is the best outcome for us,” he said.  What’s next? Although Woolworths Holdings has enjoyed strong sales and foot traffic in the first half, Bagattini noted that that is likely to change in the second half of the year, as the lingering impact of inflation starts to hit customers.  “The level of resilience [we’ve seen] is somewhat counterintuitive to a lot of the macroeconomic indicators that we’re seeing. You’d expect to see a softening of demand, but we haven’t seen that,” Bagattini said. “We do expect a softening [of demand] as some of the lagging effects of interest rates and the reality of high mortgage payments [hit].” Bagattini’s comments echo that of other business leaders, such as Woolworths Group’s Brad Banducci and Barbeques Galore’s Angus McDonald, who shared similar sentiments around the remainder of 2023 likely getting tougher before it gets easier.