Home and DIY retailer Bunnings has endured a “difficult” start to life in the UK as its sales see a double-digit decline across the country.
The Wesfarmers owned retailer reported a 13.8 per cent drop in sales to £267 million for its first quarter in the UK and Ireland. This compares to Bunnings group’s overall performance of a 11.5 per cent sales rise.
Its foray into the UK started last year when Wesfarmers bought Homebase for £340 million. It has since converted a handful of Homebase stores, but has revealed plans to open between 15 and 20 converted and new stores by the end of the year.
“While the performance of Homebase is disappointing, we continue to be encouraged by the performance of the Bunnings pilots,” group managing director Michael Schneider said.
It has attributed the sales dip to stock clearance across over 200 Homebase stores, alongside adverse trading conditions.
It also saw a £54 million loss in its maiden year in the UK, with £19 million reportedly due to losses sustained from the initial stages of conversion. Following reports of its first-year losses in August, the retailer said it expected further sales disruption during the early stages of formation.
Wesfarmers managing director Richard Goyer added that the conversion process would “take longer than we might’ve hoped. We still consider the opportunity a good one.”