Clothes to exercise gear: Kmart sales up in cost of living crisis

Clothes to exercise gear: Kmart sales up in cost of living crisis

Cash-strapped shoppers flocking to Kmart for everything from fashion to exercise equipment have helped power profits at retail giant Wesfarmers close to five per cent higher for 2023.

The $56 billion operator of the Kmart, Target and Bunnings brands revealed on Friday morning that its revenues had risen by 18.2 per cent for the year to $43.6 billion.

Profits were up by 4.8 per cent to $2.47 billion, with Kmart Group and Officeworks the standout performers for the year.

Chief executive Rob Scott called out the success of discount department store Kmart, which recorded strong growth across all categories and in all regions of Australia over the past year.

As people become more value conscious, and also as the quality of products improves, we’re attracting a lot of new shoppers,” he said.

The company told investors that the group’s strong full-year result meant it was upping its dividend, with the final fully-franked payout coming in at $1.03 per share. This brings the full-year dividend payment to $1.91 per share, a 6.1 per cent increase on 2022.

Wesfarmers said cost pressures would continue to be elevated in the face of inflation and wage cost increases, but said its brands were able to leverage their scale to and sourcing capabilities to offset some of this.

The stock opened 0.7 per cent stronger to $49.76, putting shares ahead by 9.2 per cent year-to-date.