Wesfarmer-owned DIY retailer Bunnings made a loss in its first full year on these shores as it kick-started its assault on the UK DIY market.
The Australian firm that acquired Homebase in February last year said losses before inflation and tax totalled £54m in the 12 months to June 30.
This included one-off transition and restructuring costs of £19m as the firm commenced the lengthy task of converting Homebase stores into its Bunnings Warehouse format.
The new entrant has opened four pilot stores in the UK – with plans for 15 to 20 by the end of 2017 – and has closed Argos, Laura Ashley and Habitat concessions at Homebase stores.
Bunnings generated sales of £1.2bn in the period and, in its fourth quarter, revenue declined 6.8%.
This compared to annual sales in excess of £1.4bn under previous Home Retail Group ownership.
The new owners said its performance was impacted by the “significant disruption” caused by the repositioning of Homebase.
The fledgling company, led by Bunnings UK and Ireland managing director PJ Davis – a Bunnings lifer, has introduced its low price proposition, sold-off old Homebase ranges and brought in new lines.
It said it remains in the “very early stages of formation” and predicts some disruption will continue while customers “adjust to the new offer in Homebase” and until the roll-out achieves sufficient scale.
Davis said: “While there is still more work to be done, the team has made good progress in repositioning the Homebase business.
“We look forward to bringing the Bunnings offer to more communities across the UK in the run-up to Christmas with the team working hard to have 15 to 20 pilots open or near completion by the end of the year.”
Earlier this year, Bunnings poached Damian McGloughlin from its biggest UK rival B&Q. After 32-years with the Kingfisher-owned retailer, McGloughlin will join Bunnings later this year as chief operating officer.
Read more: Bunnings’ new COO who jumped ship from B&Q
It appointed another former Kingfisher exec David Haydon as general manager, tasked specifically with handling the existing 250-unit Homebase business during the three-to-five year transition period.
The company opened its debut UK store in St Albans in February. The next clutch will be made up of a mix of Homebase conversions and newly acquired properties.