Business stories from the past week, compiled by Jason Maywald:
1. SMH.com.au: Bunnings UK woes deepen with $1 billion writedown
Bunnings’ foray into the UK and Ireland has plunged deeper into strife, with parent company Wesfarmers writing down the value of its investment there by almost $1 billion.
The retail conglomerate flagged that losses from Bunnings UK and Ireland (BUKI) would blow out to $165 million in the first half and said the project’s boss had left the company.
Wesfarmers also booked a $306 million writedown at Target. Wesfarmers bought British chain Homebase as a fixer-upper project for $705 million in 2016, and planned to spend up to a $1 billion re-branding and overhauling stores to the Bunnings brand and format.
2. AFR.com: Telstra to offer 5G in 2019
Telstra says it plans to offer 5G in 2019 and will show off its developments this week, as it looks to assert dominance over Optus in the battle for the next-generation mobile market.
NBN Co, meanwhile, dismissed the threat of next-generation mobile to its business model, after Optus surprised many in the local telecommunications market by rushing out an announcement last Friday, saying it would begin deploying 5G fixed-wireless internet to metropolitan areas in 2019.
Optus’ announcement was seen by some, spoken to by The Australian Financial Review, as a “spoiler” for a media gathering Telstra has arranged on the Gold Coast on Wednesday, where it is expected to give more concrete details of its 5G strategy.
3. SMH.com.au: The key workers fleeing Sydney
Sydney’s inner and middle-ring neighbourhoods are being sapped of locals who work in essential services including nurses, teachers and police as high house prices alter the make-up of the city’s neighbourhoods.
New research has revealed a dramatic slump in the number of key workers living in long-established Sydney regions during the past decade while areas on the urban fringe have experienced significant net gains.
The Parramatta region had the biggest net loss of essential workers between 2006 and 2016 with a decline of 21.4 per cent. Next was the eastern suburbs (-15.2 per cent) followed by Sydney’s inner south west (-14.6 per cent), Ryde (-14.2 per cent) and inner west (-11.3 per cent).
During the same period the Southern Highlands, on the extremity of Greater Sydney, experienced a 17 per cent net increase in the number of essential workers living in the region. There were also big net gains in the Hunter Valley (+13.6 per cent) and the Illawarra (+10.5 per cent).
4. Dailytelegraph.com.au: Aussies preparing to be slugged with bills
Confused Australians are taking matters into their own hands this summer, in a bid to lower energy bills.
Galaxy research commissioned by iSelect found just 32 per cent of 1144 respondents claimed to perfectly understand their energy bill, while 59 per cent understood it “somewhat”.
One thing almost all agreed on however, was that bills were high and action needed to be taken, with 90 per cent actively trying to reduce their bill throughout the hotter months. Of those without air conditioning, 100 per cent were taking action that included using internal blinds and curtains, fans and opening and closing windows at certain times to ease the effects of the heat.
Meanwhile, those with air conditioning were feeling bill pain, with 15 per cent pledging to switch their energy provider this summer.
5. News.com.au: Retail’s $160m Amazon fightback
A big white shed within earshot of a motorway on the scrubby fringe of Sydney could hardly be compared to Milan.
But what’s happening in this nondescript building, away from prying eyes, aims to revolutionise the way Australians shop for fashion.
In a sector that’s already a bloodbath, the building is ground zero for a multi-million dollar fight back from the biggest threat to Australian retail for decades — the arrival of US giant Amazon.
On Friday morning, big wigs from some of the largest brands in domestic and international shopping — names like Woolworths, Samsung, Rivers, H & M and Big W — met at the building in Prestons, Western Sydney. They were told many Australians retailers simply wouldn’t survive.
They were meeting to peek behind the loading dock and into logistic firm Toll’s $160 million state of the art automated retail and eCommerce hub.