Managing director Richard Goyder said the sales performance of the retail portfolio was pleasing overall.
“Over the year, all of our retail businesses have worked hard to deliver an improved customer offer and genuinely better value,” Mr Goyder said. “This has seen a strong focus on reinvesting savings made from improved business efficiencies into lower prices for our customers. While this has added to price deflation during the year, the strategy has been rewarded through significant growth in customer numbers and units sold.
“Coles achieved total food and liquor sales growth of 4.6 per cent for the year and comparable sales growth of 3.7 per cent. The result was driven by sustained strong volume growth during the year, which accelerated in the fourth quarter as ongoing investments in value, quality and service were positively received by customers. This was evidenced by improved customer numbers and increased basket size.
“Bunnings’ total sales increased 5.6 per cent for the year, with sales growth achieved in both consumer and commercial areas. Bunnings made good progress on all aspects of its strategic agenda, resulting in strong transaction growth despite generally tight trading conditions and the deflationary impacts of the range reset program.
“Officeworks faced deflationary headwinds during the year, particularly in the technology and furniture categories. Strong transaction growth was achieved across all channels, in particular online, resulting in total sales growth of 0.7 per cent for the year.
“Kmart reported sales in line with last year, as sustained growth in volumes was offset by continued investment in delivering lower prices for customers on everyday household items. Comparable sales growth in the fourth quarter increased to 2.1 per cent as the business focused on better communicating its storewide value and further improving its product offer and sourcing arrangements.
“Target experienced challenging trading conditions during the year, resulting in a decline in total sales of 1.8 per cent. Encouragingly, the underlying sales trend improved progressively over the second half and through the fourth quarter, as a number of new strategic initiatives were implemented. Trading in the fourth quarter was further strengthened by the earlier timing of the mid-year Toy Sale.”
Mr Goyder said the retail businesses would continue to work hard to improve merchandise offers and to provide greater value to Australian households. The retail businesses also remain committed to investing in, and growing, each of their store networks and further strengthening supplier relationships to provide a sustainable platform for future growth.
Coles opened 19 new supermarkets and closed 11 supermarkets during the financial year to achieve net growth in supermarket selling area of 1.9 per cent, one percentage point higher than the previous year.
Coles Express opened three new sites and closed two sites during the quarter, bringing the total store network to 627 sites at the end of the financial year.
For Bunnings, total store sales grew 4.7 per cent for the fourth quarter9, while store-on-store growth was 2.9 per cent, highlighting the importance of new stores openings to the chain’s performance.
During the fourth quarter seven Bunnings warehouses were opened. A further ten sites were under construction as at the end of June.
Target was the underperforming brand for Wesfarmers, with total sales of $3.7 billion for the financial year, 1.8 per cent below the previous corresponding period, with comparable store sales declining by 2.1 per cent.
Kmart flatlined with total sales of $4.0 billion for the financial year, in line with last year, with comparable store sales also in line with last year.
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