9:00AM Sydney - Woolworths Limited first-half earnings up 28% on sales rise of 8.6%.

Australia''s biggest retailer, Woolworths Ltd posted first-half net income rise of 28% to $891.3 million in the six months ended Dec. 30 on the back of an 8.6% growth in sales. The profit in the same period in the previous year was $695.6 million. Sales growth in the first half of fiscal 2008 declined to 8.6% from 15.9% in fiscal 2007.

Sales rose to $24 billion from $22.1 billion during the corresponding period last year. Earnings before interest and tax for the retailer were up 20% to $1,379.9 million from $1,145.6 million a year earlier. EBIT growth declined in the first half to 20% from 270% a year ago.

The company''s biggest unit, Australian and New Zealand supermarkets achieved a 19% rise in EBIT to $1.04 billion while revenue gained 7.9% to $20.32 billion. The company opened 19 supermarkets in the first half and plans to open 12 new stores in the second half.

Profit after tax rose 28.1% to $891.3 million compared to 28.1% rise in profit to $695.6 in the previous first half year. Earnings per share jumped 25.9% to 74.06 cents from 58.83 cents a year ago.

Woolworths declared an interim dividend of 44 cents, up from 35 cents in the first half of fiscal 2007. Its share rose 4.2%.

The company now operates 13 stores in India under licensing agreement with Tata Group under the name Croma with total sales of $46 million and a loss of $2.3 million.

The company issued interim dividend of 44 cents keeping its payout ratio of 60%. Return on equity in the first half rose to 14.97% from 13.74% a year ago and return on capital increased to 18.09% from 15.07% a year ago.

The company guided fiscal 2008 profit increase between 19% and 23%.