Woolworths chief executive Grant O’Brien is departing after almost three decades following the company’s recent “disappointing” performance.

Mr O’Brien has been at the retailing giant for 28 years and has held the chief executive position since 2011.

“The recent performance has been disappointing and below expectations,” he said in a statement.

The company has faced shrinking market share thanks to new entrant Aldi and a revitalised Coles and suffered unexpectedly huge losses in its venture into the hardware business with its Masters chain.

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Last month Woolworths unveiled a strategy to turn the business around, which included $500 million of cost savings.

“I believe it is in the best interests of the company for new leadership to see these plans to fruition,” Mr O’Brien said.

He will remain at the company until at least November to give time for a replacement search to be conducted and enable a “smooth transition”.

Chairman Ralph Waters paid tribute to Mr O’Brien’s commitment to Woolworths.

The company has also given an update on its performance in the fourth quarter.

Woolworths said it was on track to achieve the cost savings that are driving lower prices and better service and that it was in its most competitive position since January last year.

However, sales do not match the rhetoric.

As revealed at the previous quarterly update, food and liquor sales were disappointing.

“There has been no improvement in May and June to date,” the company statement said.

“Australian food and liquor recorded a decline in Easter … of approximately 0.7 per cent.”

The struggling hardware business has shown some pick-up with sales up almost 20 per cent so far in the quarter.