Conglomerate Wesfarmers Ltd
(ASX:WES) says it is making good progress in phase one of its turnaround plan for supermarket chain Coles which it acquired in 2007.
In an investors presentation this morning the company said that macro-economic conditions are tough with rising interest rates and lower consumer confidence.
Wesfarmers says food and liquor sales slowed as interest rates rose in the last six months.
The company, who also acquired retail chains Target and Kmart in the Coles transaction, says margins have come under pressure on increased competitor activity and as traditional competitors revitalise their offers.
At Bunnings, cash sales rose 11.9% for the nine months to March 31, 2010, with same-store sales up 8.8%.
At OfficeWorks retail store sales grew 10.5% between July 1 and March 31, 2010, with margins under pressure from an increase in competition.
Wesfarmers earned $1.535 billion in the year to June 30, 2009.
