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Patchy retail growth for Wesfarmers as Kmart’s sales worse than expected

Wesfarmers is expected to begin its post-Coles era with fewer debt thanks to the businesses it’s offloaded.

But a fall in earnings from Kmart is expected to be a drag on its half-year results.

The company has predicted it will post earnings before interest and tax of between $385 million and $400 million for its department stores division.

Wesfarmers also says it expects to gain between $2.1 billion and $2.3 billion from the November demerger of its Coles supermarket division.

CEO Rob Scott tells Ross Greenwood growth in sales at Kmart “was a bit below our expectations”.

“One area that was a bit below expectations through the Christmas trading period was our department store division.”