UK Bunnings remains a weight on Wesfarmers

WESFARMERS has blamed severe winter weather for another dramatic fall in sales at its struggling Bunnings venture in the UK and Ireland.

Total sales in the three months to March 31 dropped 13.5 per cent from a year ago to 211 million pounds ($A374 million), and store-on-store sales, which strips out the effect of new openings, were down 15.4 per cent. Store-on-store sales in the financial year to date at Bunnings UK and Ireland are down 13.9 per cent from the same period a year earlier.

The venture continues to be a major weakness for Wesfarmers, which incurred $1.02 billion in impairments against Bunnings UK and Ireland in the first half of the financial year.

Wesfarmers said in February that trading in Spring and Summer would be critical to the future of Bunnings UK and Ireland, amid speculation it may abandon the venture.

Bunnings Group managing director Michael Schneider said severe weather in March, brought by a cold snap across Europe dubbed ‘The Beast from the East’, significantly hurt trade at Bunnings stores in the UK, the majority of which still trade as Homebase, a British hardware retailer that Wesfarmers bought in 2016.

“Retail execution standards lifted in Homebase in preparation for Spring and stores are well-positioned for the arrival of the season,” Mr Schneider said in a statement yesterday.