Wesfarmers veteran senior executive John Gillam is stepping down after 12 years as managing director of the hardware business Bunnings.
He will continue to support the business, one of the most profitable divisions at Wesfarmers, in an advisory role, continuing as chair of the Bunnings Group Council and also joining the Bunnings UK and Ireland advisory board.
Bunnings Australia and New Zealand managing director Mike Schneider and Bunnings UK and Ireland managing director Peter Davis will now report directly to Wesfarmers managing director Richard Goyder.
Goyder says Gillam has been a massive contributor to the company.
He has worked in the business development team, been chief financial officer of Bunnings, company secretary of the Wesfarmers Group and managing director of chemical supplier CSBP before taking over as leader of Bunnings in 2004. He was also Chairman of Officeworks for eight years.
“In every role he has been outstanding and left an indelible and positive legacy,” says Goyder.
“His performance at the helm of Bunnings has seen him now recognised as one of Australia’s leading retailers and Bunnings is now a national institution. The recent acquisition of Homebase in the UK and Ireland has provided our company with a new platform for long-term future growth.”
Home improvement is the stand out division within Wesfarmers, Australia’s biggest private employer. Revenue for the year to June jumped 21% to $11.57 billion.
EBIT (earnings before interest and tax) increased 11.6% to $1.21 billion, second only to the supermarket business unit Coles which reported earnings of $1.86 billion but growth of only 4.3%.
Profitability is superior. The return on capital at Bunnings in Australia is 36.6% while Coles manages just 11.2%.
Homebase, the recent acquisition in the UK, contributed four months to the 2016 results. Sales from the UK were £512 million ($A986 million) and earnings after restructuring costs £0.5 million ($A1 million).