Discount department stores Target and Kmart are still in a rut, according to second quarter sales results released by parent company Wesfarmers today.
The report, for the three months ending December 31, 2011, revealed total sales drops for both businesses, compared to the previous corresponding period.
Target – which recently welcomed new managing director Dene Rogers following the resignation of Launa Inman – suffered a sales drop of 3.1 per cent to $1.3 billion, with comparable store sales also declining 3.1 per cent.
Sister company Kmart also saw total sales fall by 2.2 per cent, to $1.4 billion for the quarter, with comparable store sales down by 2.7 per cent.
Overall, results for the first half of the 2012 financial year were also lacklustre, with total sales declining 2.5 per cent at Target, to $2.1 billion, and 1.3 per cent at Kmart, to $2.3 billion.
Despite plummeting sales, Wesfarmers managing director Richard Goyder said the group had done well, “given the relatively tough retail environment and widespread deflation”. However, he admitted that Target in particular had suffered as a result of difficult trading conditions.
“Target experienced difficult trading conditions in the quarter with total sales declining. December sales were more encouraging as the business took steps to improve effectiveness and stock management,” he said.
Rogers also said sales were negatively affected by tough trading conditions across the market.
“Having joined Target just prior to the important Christmas trading period, I am pleased with the initial customer response to the changes made to our marketing program. While customer numbers were down across the quarter, there was noticeable improvement in December,” he said.
As previously reported on ragtrader.com.au, the second quarter sales results for Target and Kmart follow disappointing first quarter sales in 2012 for both brands.
For the period June 27, 2011 to September 2011, Kmart saw total sales up slightly by 0.1 per cent to $927 million for the quarter, with comparable store sales increasing 0.5 per cent. Target, however, reported a sales decline of 1.4 per cent to $835 million, with comparable store sales down 4.1 per cent.