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Bunnings, Officeworks shine as Wesfarmers delivers $1.7 billion profit

Published: (Updated: ) in Australian News by .

The shining light of the group was DIY brand Bunnings, which posted a 13.9 per cent increase in revenue to almost $15 billion.

Retail and business conglomerate Wesfarmers has reported a statutory net profit of $1.7 billion after tax, despite taking a $500 million hit due to poor performing chain Target.

Wesfarmers, who owns Bunnings, Kmart, Target and Officeworks among a number of chemical and safety divisions, posted a net profit after tax of $2.1 billion despite COVID-19 wreaking havoc on Australia's retail market.

The shining light of the group was DIY brand Bunnings, which posted a 13.9 per cent increase in revenue to almost $15 billion as consumers rushed to stock up on equipment during lockdown.

READ MORE: Bunnings, Kmart to pay Melbourne employees full wages during lockdown

Melbourne, Australia

Officeworks also performed strongly, posting a huge 20.4 per cent increase in revenue to $2.8 billion.

Kmart Group's results told two stories: while revenue jumped 7.2 per cent to $9.2 billion for the year, overall it recorded a $222 million loss due to the restructuring of underperforming brand Target.

The result included an eye-watering $635 million bill to convert Target stores to Kmart and to simplify the Target business.

READ MORE: Kmart stores introduce 'click and collect' service

Wesfarmers Managing Director Rob Scott said the conglomerate's year was severely disrupted not just due to COVID-19 but due to the Australian bushfires too.

"Bunnings, Kmart, Officeworks and Catch delivered strong sales growth for the year," Mr Scott said.

"Earnings in Bunnings and Officeworks were particularly strong and demonstrated the ability of these businesses to rapidly adapt to the changing needs of their customers.

"Earnings across all businesses reflected accelerated investment in digital capabilities and additional costs associated with operating in a COVID-19 environment."

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READ MORE: Kmart unveils three new 'K Hub' stores as Target conversion gets underway

Wesfarmers – who also own online shopping haven Catch.com.au – said sales have rapidly moved to digital platforms.

""The Group's retail businesses delivered total online sales growth of 60 per cent during the year, excluding Catch," Mr Scott said.

"Total online sales across the Group, including the Catch marketplace, increased to $2.1 billion.

"This reflects the significant investment in digital capabilities over recent years, as well as the continued change in customer preferences towards online shopping."

Wesfarmers declared a fully-franked final dividend of 77 cents per share.

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Source: 9News https://www.9news.com.au/national/wesfarmers-fy20-financial-results-bunnings-kmart-officeworks-giant-booms-during-covid19/0f370d5a-9bb1-4a64-a4d3-e7b69d9ab583

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