Australian conglomerate Wesfarmers has moved to reassure shareholders that the turnaround of its Coles supermarket business is progressing apace.

Speaking at the company's AGM in Perth, CEO Richard Goyder said that the five-year Coles rejuvenation plan was "on track".

"We are 12 months into a five-year turnaround for Coles and we are on track and feeling good about the business," he said

Goyder indicated that Wesfarmers intended to remain focused on long-term goals at Coles, despite the current difficult trading conditions caused by the economic slump.

"Meaningful and sustainable improvement will take time, and we are not going to cut corners," he said. "I want to emphasise that the changes we need to make at Coles are entirely within our control and need to be made regardless of external conditions."

Goyder said that on-shelf availability had improved, central costs had been reduced, new store formats had been introduced, investments have been made in upgrading stores and supply chain and IT issues are being addressed. Importantly, Goyer said, "we're making inroads into improving value and customer trust".

"The deep, cultural change needed to underpin the turnaround is underway," he said. "The foundations needed for a sustained turnaround are being put into place, and driven at pace."

Wesfarmers increased levels of debt to fund the A$19bn (12.79bn) buy of Coles, Australia's second largest supermarket, in November last year.

Wesfarmers has almost A$3.5bn in debt due to be refinanced at the end of 2009 and A$5bn due in 2010. Concerns over the company's ability to refinance debt during the credit crunch have weighed on the company's share price.

Goyder also moved to reassure shareholders on this point.

"We have a balance sheet with a net debt to equity ratio of around 50 per cent which is around where we would normally like it, and strong interest cover. We feel that the concerns that some have expressed around this issue are unfounded," he said.

Goyder indicated that there is "considerable opportunity" to release working capital from some of its businesses - particularly Coles.

"We will continue to actively manage this aspect of our business in the best interests of shareholders," he concluded.