Bunnings is opening a further five stores in New Zealand as it benefits from an uplift in residential construction and renovation, particularly in Auckland.
The retailer with stores in Australia and New Zealand is part of ASX-listed Wesfarmers whose other retail brands include Coles supermarkets and the Kmart and Target department store chains.
Bunnings was the best performer in the group for the first-half ending Dec. 31, increasing earnings by 13 per cent to $A701 million ($NZ757.59m) as revenue rose about 11 per cent to $A5.5 billion ($NZ5.94m). That means the stores in Australia and New Zealand accounted for 16 per cent of group revenue and one third of profit.
Bunnings NZ general manager Jaqui Coombes said the New Zealand unit has quadrupled turnover to $898m for the 2015 financial year since setting up in this country in 2002.
Wesfarmers doesn’t break out New Zealand operations in its first-half results but Coombes said she was happy with progress across all markets.
Bunnings has 50 stores in New Zealand, including 25 warehouse stores, 19 smaller format ones, and 6 trade centres which supply heavier construction materials.
Coombes said the company didn’t have a target number of stores to hit in New Zealand but still sees plenty of opportunity for more growth despite strong competition from rivals cooperative Mitre 10 and Fletcher Building-owned Placemakers.
“Competition stops us being complacent,” she said.
Bunnings is relocating a Taupo store to a bigger site and opening new stores in Petone and Naenae in Wellington by the end of the second half in July, opening stores in Grey Lynn and Westgate in Auckland in the first half of the 2017 financial year, and one store in south Hamilton in the Waikato by early next year.
Bunnings managing director John Gillam said the chain would continue to extend its brand reach physically and digitally, and it expects to open more than 30 new stores in Australia and New Zealand in the next two financial years. At the end of the first half the chain had a total of 339 stores.