Listed conglomerate Wesfarmers has reported tax-paid profit reached $2.5 billion in FY23 as operating conditions and consumer behaviours continued to normalise.
The company’s retail business comprises Bunnings, Officeworks, and Kmart Group which in turn includes Target and Catch.
For the year to June 30, group sales rose 18.2 per cent to $43.5 billion while tax-paid profits reached $2.5 billion, up 48.8 per cent and EBIT of $3.8 billion, up 6.3 per cent.
Kmart Group’s revenue, (including Target) grew 16.5 per cent to $10.6 billion with growth across all categories and registered an increase in units sold and transaction volumes.
Officeworks’ revenue increased 5.9 per cent to $3.4 billion driven by Back to School trading, growth in technology categories and in the B2B business.
As foot traffic continued to normalise, the business reported increased demand across stationary, art, office supplies and Print & Create services.
Online marketplace Catch’s gross transaction value declined 25.9 per cent to $733 million during the year impacted by changing customer demand, poor margin outcomes in the in-stock range along with elevated supply chain costs.
Bunnings’ revenue increased 4.4 per cent to $18.5 billion with sales growth recorded in both consumer and commercial customer segments and across all trading regions despite prolonged wet weather on spring trading on the East Coast.
During the financial year, the group acquired InstantScripts in July and entered into a Scheme Implementation Deed with Silk Laser Australia to acquire the business.
Wesfarmers MD Rob Scott said the results were underpinned by strong divisional earnings growth of 12.9 per cent for the year as the business continued to respond well to trading and market conditions.
“Wesfarmers maintained its focus on long-term shareholder returns and continued to advance key growth projects during the year, while also taking proactive steps to drive productivity and efficiency across its business.”
The business says elevated inflation and higher interest rates are expected to continue and customers are becoming more value-conscious and trading down to lower-priced retailers and products.
For the first seven weeks of FY24, sales growth has continued to benefit from strong trading from Kmart Group while sales remain in line at both Bunnings and Officeworks.
