Woolworths boosted by wholesale contract

Woolworths unveiled a much-needed boost today after its wholesale arm secured a major contract to supply Virgin Retail with entertainment products.

The three-year deal means the division, EUK, will assume responsibility for buying Virgin’s music, DVD, games and books products.

Shares were up 3% today as EUK continues to replace the business due to be lost when Tesco ends its contract with the firm later this year.

With new contracts and the recent acquisition of books wholesaler Bertram, EUK is poised to generate annual sales in the region of £1.2bn (€1.8bn).

The growth of EUK comes at a time when Woolworths is struggling to revive sales on the high street. Earlier this month, the retailer said like-for-like sales fell 4.6% in the six weeks to January 13.

Woolworths chief executive Trevor Bish-Jones said today: “EUK is extremely excited to be working with Virgin, one of the strongest brands in the world and one of the most vibrant names on the high street. The new contract strengthens EUK and is another important milestone in the development of the business.”