Kmart's New Zealand division has revealed a profit of $100 million for 2024, likely sending more warning signs to its biggest competitors. Photo / Alex Cairns
Kmart's New Zealand division has revealed a profit of $100 million for 2024, likely sending more warning signs to its biggest competitors. Photo / Alex Cairns
Kmart’s New Zealand division has revealed a bumper $106 million profit for its 2024 financial year.
Owned by the Australian group Wesfarmers, which also owns Bunnings Hardware, the retail business grew its net profit after tax by 52.2% year-on-year, up from $69.6m.
The business’ revenue for FY24 grew from $923.9m in FY23 to $999.5m, increasing by 8.1% in the year to June 30.
Kmart benefitted from a lower cost on goods sold which fell from $567.9m to $560.8m although its selling and occupancy expenses and admin costs were up. Its finance income rose from $177,289 to $401,282 while its other income also rose from $825,877 to $1,158,696.
The bumper profit comes as the retailer is expanding in New Zealand with plans announced in September to build its largest New Zealand store in the growing Westgate business district.
John Gualtieri, Australia and New Zealand chief executive said in September that the difficult retail climate was one of the reasons Kmart wanted to build a colossal new store on this side of the Tasman.
“As New Zealanders continue to face rising household costs, providing access to great value products at the lowest prices has never been more important to our customers,” he said.
Kmart CEO John Gualtieri (left) and Tainui Group Holdings CEO Chris Joblin. Photo / Supplied
Kmart’s total revenue, including its Australian business and its brand Target, grew by 4.4% to A$11.1 billion for FY24.
The business’ earnings before tax grew to A$958m, up from A$769m in 2023.
In Wesfarmers' annual report, Kmart Group managing director Ian Bailey said that the business would continue to progress its strategic agenda.
“The 2025 financial year will see the investment in a number of core capabilities in technology for stores and supply chain to enable future growth,” Bailey said.
“Performance in the 2025 financial year will be influenced by ongoing cost of living pressures affecting customers’ spending capacity, particularly in New Zealand, as well as by increased competitive intensity.”
Wesfarmers Group’s share price was trading around A71.68c today on the ASX.
Intense competition
The competitive intensity does not appear to have affected Kmart’s bottom line, as other retailers struggle to match the Australian giant.
The Warehouse Group revealed one of its toughest results in years back in September, reporting a net loss after tax for the year of $54.2 million in FY24.
Total revenue for the group fell from $3.4 billion to $3b.
Sales for The Warehouse were $1.8b, down 5.3% year-on-year, Warehouse Stationery was down 6.7% to $231.9m and Noel Leeming was down 5.3% to $1b.
Meanwhile, Briscoe Group reported a positive half-year result, but its performance was down compared to the same time last year.
The group reported a net profit after tax of $33.21 million to July 28, down from $42.75m for 1H2023.
The group did face a one-off, tax adjustment due to changes in depreciation rates to commercial buildings, which if removed meant its net profit increased to $40.58m for 1H2024, down 5% compared to 1H2023.
Total revenue for the group had a slight increase of 0.77% year-on-year, up from $369.2m in 1H2023 to $372m in 1H2024.
Tom Raynel is a multimedia business journalist for the Herald, covering small business and retail.
