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Wesfarmers HY Adj. Profit Up 5.7%; Says Target Staff Underpaid

Wesfarmers Limited reported that its net profit after tax, excluding the impact of the new lease accounting standard and discontinued operations, for the half-year ended 31 December 2019 increased 5.7 percent to A$1.14 billion.

Net profit after tax was A$1.21 billion for the half-year ended 31 December 2019.

Revenue for the period was A$15.25 billion, compared to A$14.39 billion in the prior year.

Wesfarmers has admitted to further underpayment of staff, including Target workers, after previously underpaying the superannuation of Bunnings employees. The company set aside $9 million to repay Target staff.

"Immediate steps are being taken to rectify identified issues, notify and repay affected team members, including interest, and ensure accuracy in the future through a robust program of auditing and monitoring," Managing Director Rob Scott said.

Last October, Wesfarmers said about 6,000 staff were underpaid about A$15 million since 2010.

Wesfarmers today reported Kmart total sales growth of 7.6% reflected a continued focus on lowest price positioning, stronger operational execution and enhancements to the product range. Target sales decline driven by reduction in customer transactions with key categories in apparel performing poorly.

Looking ahead, the company said Kmart remains well-positioned in the market. Target performance is unlikely to improve materially in the near term.

Wesfarmers said that trades have been executed for the sale of 4.9 percent of the issued capital of Coles Group Limited (COL.AX) for total pre-tax proceeds of A$1.05 billion.

Following the sale, Wesfarmers will have a 10.1 percent interest in Coles and retains the right to nominate a director to the Coles Board.

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