Combined Kmart and Target sales were down 10.3% in the first half of the financial year due to Covid restrictions on stores coupled with the permanent closure of Target and Target Country stores as part of planned network changes.
Trading conditions improved during the second quarter as restrictions eased but in-store shopping was impacted by rising community transmission of Covid in some states, with the Omicron variant continuing to subdue foot traffic in the first half of January.
Although ongoing supply chain disruptions have been managed by holding additional inventory on shore, high levels of Covid-related absenteeism in New South Wales and Victorian distribution centres is impacting the ability to deliver stock to stores in line with customer demand.
Combined online sales for Kmart and Target were 44.2% higher than the prior corresponding period.
Combined earnings before tax (EBIT) for Kmart and Target is expected to be between $215 and $223 million for the half.