Homebase owner could close up to 40 stores

Up to 2,000 jobs at risk if Wesfarmers goes ahead with store closures

Homebase is in the process of being rebranded as Bunnings (Rex)

The Australian owner of Homebase is considering closing up to 40 stores in the UK after “disappointing performance”.

Closures by Wesfarmers, which purchased the DIY firm in 2016, potentially put up to 2,000 jobs at risk.

Wesfarmers said on Monday that it expects Homebase to report a heavy loss of £97m in the first six months of 2018.

The parent company says Homebase’s poor performance has reduced the chain’s value by £454m.

Shares in Wesfarmers fell by almost 5 per cent on Monday morning.

Wesfarmers managing director Rob Scott said the Group’s focus on “satisfactory returns” for its shareholders will see a review to “address underperformance”.

Homebase has a total of 250 outlets in the UK and employs 12,000 people.

Wesfarmers is in the process of rebranding all Homebase stores as Bunnings, an international home-improvement retailer.

Wesfarmers’ half-year results and review of its stores is expected to be released in June.

“It’s undoubtedly distressing news for employees of Homebase and their families”, said Martin Lane, editor of financial comparison website money.co.uk.

“Those who fear they could lose their jobs should hope for the best but prepare for the worst”.

He accused bosses at Homebase of taking their “eye off the ball” and forgetting to give shoppers what they wanted.

“The retail industry has dramatically changed, shoppers are reluctant to pay full price and they seek out who’s offering the cheapest online. Stores like Homebase don’t stand a chance against the online retail giants unless they can offer something special”, he said.

Homebase is the latest retailer to announce large-scale job cuts, following M&S, Tesco, Sainsbury’s, Asda and B&Q.