It's 10 months later but Y2K is still wreaking havoc on Coles Myer's
bottom line.
The retail giant recently reported towering abnormal losses for the
1999-2000 financial year, with Y2K compliance, the GST and Web-related
restructuring costs singled out as the major causes for expense.
Abnormals for the year totalled more than AU$260 million, representing an
increase of more than four times that of the previous year, when the
retailer reported abnormals of just AU$58 million - all attributed to Y2K.
This year, the retailer said it spent a further AU$9.2 million on compliance
costs related to the millenium bug.
The retailer also spent AU$138.5 million on GST compliance, a non-existant
expense the year before.
Coles Myer said in a statement that expenses related to GST compliance were
"extensive and above planned levels, due to onerous regulatory and
logistical issues associated with its (GST) introduction".
The company reported a spend of AU$24.9 million on restructuring its Direct
Fulfilment Group to become Internet-enabled. That restructuring was centred
around transforming the Myer Direct catalogue into an e-tail operation,
Coles Myer said.
Other expenditure, related to the closure of underperforming business
divisions, accounted for an additional AU$87.6 million in abnormals.
Coles Myer did not return ZDNet's calls for further comment by publishing
time.
