“The performance of the industrials division during the year was significantly affected by depressed conditions across the resources sector”, managing director Richard Goyder said in a statement.
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Underlying profit excluding the $2 billion in losses and write-downs from the company’s Curragh coal mine and the Target chain came in 7.7 per cent weaker at $2.25 billion, falling short of analyst expectations.
The Perth-based conglomerate’s underlying profit, excluding the writedowns, dropped 3.6 per cent to $2.35 billion.
(WES.AX,WFAFF.PK) reported Wednesday that its fiscal 2016 net profit attributable to members plunged 83.3 percent to A$407 million from last year’s A$2.44 billion.
“The continued momentum in Coles’ Food and Liquor business was a good result given a competitive market and accelerating deflation during the year”, says Goyder.
Wesfarmers also said fiscal 2017 would be a “transitional” year for Target, as the banner undertakes changes to improve its results.
The group said today its final dividend had been reduced by 16c to 95c a share fully franked, making $1.86 for the year, against $2 previously.
Total store sales increased 13.5% for the year, with comparable store sales increasing 10.5%.
Bunnings’ earnings rose 11.6 per cent to $1.2 billion on revenue growth of 21.4 per cent. Same-store sales grew 8.1 per cent. Within this environment, the Group’s retail businesses are well-positioned to continue to deliver growth through strategies that are focused on achieving further improvements in value, service and range. Ongoing merchandise innovations, digital strategies and store network improvements and expansions, are expected to contribute to growth.
Wesfarmers have made plans to convert Homebase stores to its more successful DIY outlet Bunnings, with four to six pilot stores set to open across the United Kingdom by the end of next June, and more to come if the pilots are financially successful.
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Coles comparable food and liquor sales – a key revenue measure – were markedly lower than the previous quarter’s 4.9 per cent comparable growth and lower than the 3.6 per cent growth recorded in the fourth quarter a year ago.
