The Australian owner of struggling DIY chain Homebase has revealed woes at its UK business left half-year profits crashing 87%.
Bunnings group Wesfarmers, which bought Homebase in 2016, confirmed a hit of 931 million Australian dollars (£524m) on its UK and Ireland arm as it saw losses more than treble in the division.
It blamed the “rapid repositioning” of Homebase and difficult trading in the UK for an increase in underlying pre-tax interim losses in the UK business to £97m from losses of £28m a year earlier.
The writedown and UK losses left Wesfarmers’ nursing an overall plunge in group profits to A$212m (£119m) for the six months to December 31 from A$1.6bn (£901m) a year earlier.
Wesfarmers dealt a blow earlier this month when it said warned up to 40 Homebase stores could shut putting nearly 2,000 jobs at risk.
The group is rebranding Homebase as Bunnings - a well-known brand in Australia - but the £340m takeover and overhaul in the UK is so far proving ill-fated, given the differences in the two markets and tough retail trading conditions in Britain.
Wesfarmers reported a 15.5% tumble in revenues to £517m in the UK and Ireland business and confirmed that five loss-making Homebase branches were closed in its first half.
But it said it was working hard to improve UK trading and will update on its review of Homebase in June.