Bunnings does heavy lifting for Wesfarmers as hardware giant’s CEO Michael Schneider flags exit

Wesfarmers’ shift into health and wellbeing is paying dividends.

But its full-year results released on Thursday show there is little stopping the runaway success of its Bunnings stores and the power of the hardware giant to lure in shopper, even amid a cost-of-living crisis.

The WA conglomerate unveiled a 3.4 per cent rise in revenue compared to the previous year to $47.3 billion.

Bunnings brought in $20.4b of that total — up 4.1 per cent from a year earlier.

Its health divisions — which includes Priceline Pharmacy, Australian Pharmaceutical Industries, Clear Skincare and The Silk Group — is proving its earning potential, with revenue soaring 9.1 per cent, up from $5.93b the previous year to $6.5b.

Kmart, Officeworks and its chemicals division also reported solid growth.

Full-year net profit excluding significant items came in at $2.9b, up 8.3 per cent. With those added back in, profit slipped 1.8 per cent to $2.87b.

The board declared a 9¢ rise in the final dividend to $1.20.

Wesfarmers said it recognised the impact of ongoing inflation on households and businesses, “and the retail divisions play an important role in the community through offering everyday low prices”.

It also pointed to subdued activity in the residential housing sector over the short term.

“The structural housing undersupply and population growth are expected to support increased building activity in the medium term and Bunnings remains well positioned to benefit from this recovery,” it said.

Bunnings boss to step down

Wesfarmers also announced a major change at the top of its powerhouse cash machine.

Managing director Michael Schneider will retire next February.

He will be succeeded by Rachael McVitty, Bunnings’ chief customer officer.

Ms McVitty has been with Wesfarmers for more than 17 years and has held several senior executive roles across the group, including as chief executive of Blackwoods and chief financial officer of Wesfarmers’ industrials division.

Wesfarmers chief executive Rob Scott thanked Mr Schneider for his “exceptional” contributions to Bunnings and the broader group over many years.

“Mike has been an outstanding leader of Bunnings, leading the business across a decade of consistent growth in sales and earnings while strengthening Bunnings’ strong culture and trust with the community,” Mr Scott said.

“He has overseen significant transformation of Bunnings’ customer offer and digital ecosystem, which has set the business up for future success while also creating value for Wesfarmers shareholders.

“Mike retires as managing director with Bunnings in excellent shape.

More to come