Wesfarmers flags slowdown in coming months.

 

Officeworks has seen a “significant” increase in sales over the past two months due to the COVID-19 crisis but demand for the company’s extensive range of office supplies is expected to taper off in coming weeks.

 

In a COVID-19 update to the ASX, parent company Wesfarmers said Officeworks (and hardware division Bunnings) have experienced “significant demand growth as customers and their families spent more time working, learning and relaxing at home. 

 

“As a result, sales growth for the third quarter of the financial year and the first three weeks of April has increased relative to levels achieved in the first half of the financial year.” 

 

However, the company said that given the disruption to usual customer shopping patterns and potential future changes to government measures, it is uncertain whether the higher levels of sales growth will continue for the remainder of the financial year.

 

Wesfarmers added that its retail businesses have also made significant progress in further enhancing their digital offers while responding to the substantial increase in online sales. This includes the implementation of

‘Drive & Collect’ by Bunnings and Officeworks, enabling contactless carpark collection by customers, and the conversion of three Kmart locations to ‘dark’ stores to support its growing online business.

 

As part of its update, Wesfarmers also highlighted the continuing poor performance of its Target division, which is now the subject of a strategic review which could result in the disposal of the business.