Finance expenses help push Bunnings into red

Home improvement supplies retailer Bunnings has slipped into the red, reporting an annual loss of $2.6 million despite revenues increasing almost 9 per cent to $637.3m.

But it appears to have benefited from a flurry of DIY activity in the lead-up to Christmas.

The loss for the year ended June 30 follows a $1.9m net profit for the previous year, according to results filed with the Companies Office.

The result appears to be due to higher costs and finance expenses, with selling expenses up 11.4 per cent to $133.2m and administrative expenses up 51 per cent to $23m.

Before tax and finance costs, the retailer made a profit of $15.8m for the year. But that was more than unwound by $17.5m in finance costs - almost all of which was interest on related-party loans.

New Zealand general manager Jacqui Coombes said the company was pleased with the result. "We're happy with the way our stores are trading and we're seeing positive activity across a number of categories."

Data from eftpos network operator Paymark shows spending in hardware stores in December was up 9.2 per cent year on year.

Coombes said retail figures showed positive trends in the past few months and last month had been no exception. "This is the time of year that traditionally Kiwis get into DIY projects and tidying things up ready for summer . . . we don't go into detail [but] our customers do appear to have been busy."

Bunnings has about 50 stores in New Zealand and employs more than 3000 staff. Fairfax NZ

Taranaki Daily News