Wesfarmers Limited has announced a net profit after tax of $1.535 billion for the 2008/09 financial year, an increase of 44 per cent on the $1.063 billion reported for the previous year.
The successful result was due to the significant revenue and earnings growth for Resources, Coles, Bunnings and Target.
Managing director Richard Goyder said the 44 per cent profit increase was a good result in what had been a challenging year.
“At a time of continuing concern about the impact of the economic crisis on employment in Australia, I am very pleased that we have continued to invest in all of our businesses, in particular the retail operations, leading to the creation of more than 10,000 new jobs in the past year,” said Goyder.
The turnaround of Coles continues to meet the company’s expectations with a stronger in-store offer driving increasing customer numbers and basket growth.
“We now have exceptional teams in place leading all of our businesses with clear strategies that underpin future growth plans. In particular, the improvement in Coles is very encouraging with its performance reflecting good customer response as we progress through the early stages of the five year turnaround plan,” said Goyder.
Bunnings and Target both delivered strong performances reflecting the quality of their customer offers and ability to continue to drive organic growth.
“The strength of the Bunnings and Target leadership teams and respective customer offers were evident in the quality of their results and shows each of these businesses to be world-class.”
The business transformations underway at Officeworks and Kmart progressed well albeit, in the case of Kmart, improvement is still at an early stage.
Operating cash flow was strong as strategies delivered improvements in working capital management in Coles, Target and Kmart.
The balance sheet was strengthened with net debt reduced by $4.8 billion during the year resulting in a closing net debt to equity ratio of 18.3 per cent.
“Positive support from our shareholders for the equity offer earlier this year, combined with strong free cash flow generation, added strength to the balance sheet and takes the Group into 2010 in a solid position," said Goyder.