Woolworths Ltd said on Friday first half-year net income fell 33 percent Reuters/David Gray

Woolworths Limited (ASX:WOW) on Friday recorded a 176 percent fall in profit from the $1.28 billion it posted in the previous corresponding period, and its outlook for the rest of the year doesn't seem to be much brighter.

The retailer's half-year financial report revealed an after tax loss of $972.7 million -- its first loss since publicly listing 23 years ago -- while dividend per share fell 34.3 percent to 44 cents.

Woolworths attributed the disappointing six month results to “significant change” within the business, although its failed home improvement venture is what really hit the grocery giant right under the belt.

“Woolworths is going through a period of significant change. This result reflects the impact of those changes, most notably the considerable investment in price, service and customer experience across Australian Supermarkets,” said Chairman Gordon Cairns.

“The reported earnings result is also heavily impacted by the decision taken to exit the Home Improvement business and the subsequent provision for the impairment of assets, lease liabilities and other exit costs.”

Woolworths had announced in January that it would drop its loss-making home improvement businesses Masters Home Improvement and Home & Timber Hardware after being unable to compete with already established hardware business Bunnings. An estimated addition of $70-80 million in restructuring costs is expected to be recognised in the second half of FY16.

“The decision to exit Home Improvement will allow Woolworths to focus its energy and resources on strengthening and executing its plans in its core businesses,” said Cairns.

“We are rebuilding the Woolworths business. While we have made progress, it will be a three to five year journey and there is much to do.”

The hard road ahead is certainly not lost on the supermarket giant, who added in its ASX announcement that it is not "anticipating a significant improvement in comparable sales in Australian supermarkets in the second half", particularly as the market remains competitive and supermarket price wars continue to push prices down.

The news of Woolworth's bleak results comes as it appoints of Brad Banducci as CEO and managing director, who replaces Grant O’Brien effective immediately.

Banducci has spent five years with Woolworths, including leading the growth of the company’s Liquor Group as its MD in 2012, and later the MD of Woolworths Food Group in 2015. Prior to starting his stint at the supermarket giant, Banducci was CFO at Tyro Payments and a director with BCG.

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