Wesfarmers Limited · ASX:WES
Wesfarmers — Citigroup, Goldman Sachs JBWere and JPMorgan Investment Conferences 2009
104 slides from Wesfarmers's conference presentation, Mar 9, 2009
Slide 1: ASX cover letter for conference presentation
For personal use only 9 March 2009 The Manager Company Announcements Office Australian Securities Exchange Dear Sir, PRESENTATION TO BE GIVEN AT CITIGROUP (LONDON), GOLDMAN SACHS JBWERE (NEW YORK) AND JPMORGAN (SINGAPORE AND HONG KONG) INVESTMENT CONFERENCES Following is a presentation that is to be
Slide 2: Investment Conference: Philosophy, Performance and Direction
For personal use only Investment Conference Philosophy, Performance and Direction Citigroup, London – 9 & 10 March Goldman Sachs JBWere, New York – 12 & 13 March JPMorgan, Singapore and Hong Kong – 16 & 17 March March 2009
Slide 3: Disclaimer
Disclaimer For personal use only This presentation has been prepared by Wesfarmers Limited. The information contained in this presentation is for information purposes only and does not constitute an offer to issue or arrange to issue, securities or other financial products, nor is it intended to con
Slide 4: Philosophy Based On A Single Focus
For personal use only Philosophy Based On A Single Focus Satisfactory Returns To Shareholders
Slide 5: Long-term, consistent strategies
Long-term, consistent strategies For personal use only MANAGING BALANCE SHEET EFFECTIVELY 4
Slide 6: Returns focus
Returns focus For personal use only Objective: Satisfactory Returns to Shareholders Measured by TSR performance over the long term Efficiency: Growth: Improvement in ROE Growth in Invested Capital Growing divisional ROC Acquisitions and Expansion 5
Slide 7: Portfolio of leading brands
Portfolio of leading brands For personal use only Retail Businesses Industrial Businesses Hotels Insurance 6
Slide 8: Management Team
Management Team For personal use only Managing Director Richard Goyder Finance Director Gene Tilbrook* Divisional Managing Directors Home Improvement & Office Supplies John Gillam Coles Ian McLeod Target Launa Inman Kmart Guy Russo Insurance Rob Scott Chemicals & Fertilisers Ian Hansen Coal Stewart
Slide 9: Group Results
For personal use only Group Results
Slide 10: Group Performance Highlights
Group Performance Highlights For personal use only • Significant increases in revenue and earnings – Inclusion of full period of Coles, Target, Kmart and Officeworks • Operating revenue of $26.4 billion • Group profit after tax of $879 million, up 46.3% – After inclusion of $125 million of writedown
Slide 11: Group Performance Summary
Group Performance Summary For personal use only Half Year ended 31 December ($m) 2008 2007* % ^ Operating revenue 26,363 9,808 168.8 EBITDA 2,236 1,266 76.6 EBIT 1,759 1,046 68.2 Net profit after tax 879 601 46.3 Operating cash flow 1,770 1,241 42.6 Earnings per share (excl. employee res. shares) 10
Slide 12: Divisional EBIT
Divisional EBIT For personal use only Half Year ended 31 December ($m) 2008 2007* % Home Improvement & Office Supplies 395 332 19.0 Coles 431 130 n.m. Target 215 118 n.m. Kmart 75 101 n.m. Resources 686 112 512.5 Insurance 67 64 4.7 Industrial & Safety 68 61 11.5 Chemicals & Fertilisers 4 48 (91.7)
Slide 13: Provisions and write-downs
Provisions and write-downs For personal use only Period ended 31 December ($m) 2008 Comment Coles (65) Coles Property writedown DC Closure and Kmart (14) restructure costs Non-trading items (79) Self Insurance (48) Increase in provisions Mark-to-market of Investments (21) investments One-off trading
Slide 14: Operating Divisions
For personal use only Operating Divisions
Slide 15: Coles
Coles For personal use only • Intensive period of change 1. Building a solid foundation led by new management Strategies 2. Delivering consistently well • Encouraging signs in early phase of recovery 3. Driving the Coles difference programme • Food & Liquor comp sales growth of • Meaningful and sust
Slide 16: Coles – Strategy years – phases of recovery
Coles – Strategy 5 years – 3 phases of recovery For personal use only Building a Solid Delivering Driving the Coles Foundation Consistently Well Difference Performance • Culture of continuous • Embed the new culture improvement • Create a strong top team • Team member development • Strong customer t
Slide 17: Coles – Strategy
Coles – Strategy Phase 1 Progress For personal use only Create a strong top team 100% of leadership team new to Coles/role with over 125 years of retailing experience. 45% of top 200 managers new to Coles/role. Cultural change 1,500+ non-store positions removed. Store manager authority improved. Sto
Slide 18: Home Improvement and Office Supplies: Bunnings
Home Improvement and Office Supplies For personal use only Bunnings 1. Profitable sales growth • Bunnings continuing to 2. Building a stronger team perform strongly Strategies 3. Lifting effectiveness and efficiency • Focus on delivering on 4. Sustainability focus strategic agenda • 10.3% cash sales
Slide 19: Home Improvement and Office Supplies: Officeworks
Home Improvement and Office Supplies For personal use only Officeworks 1. Improving the customer offer • Substantial work to address 2. Lifting service Strategy strategic impediments 3. Team development & engagement Develop- ment 4. Reducing complexity & cost of doing • Difficult trading conditions
Slide 20: Target
Target For personal use only 1. Focus on fundamentals • Continuing to perform well 2. Brand relaunch 3. Differentiation • Well positioned for slow Strategies 4. Store network development down in retail spending and 5. Customer service to benefit from Govt. 6. Team member performance 7. Business impr
Slide 21: Kmart
Kmart For personal use only 1. Fix the customer experience • Guy Russo, Managing 2. Significantly reduce the cost base Director, recently appointed Strategies 3. Rebuild customer trust • Senior management 4. Make every site a success changes complete 5. Right people and accountability • Comp sales g
Slide 22: Resources
Resources For personal use only • Resources benefiting from 1. Maximise export sales and optimise sales mix record export coal prices 2. Cost reduction programmes • Forecast Curragh Strategies 3. Expansion opportunities metallurgical sales of 6.5 – 4. Extend product and market reach 6.9mt in FY09 5.
Slide 23: Insurance
Insurance For personal use only Underwriting • Rate increases being 1. Single licensed entity for Aust. 2. LGNZ margin improvement achieved 3. Build technical capabilities Strategies Broking • Continuing consolidation of 1. Leverage combined capabilities brokers/distribution 2. Build the best team 3
Slide 24: Chemicals & Fertilisers
Chemicals & Fertilisers For personal use only • Demand for mining 1. Growth through expansions chemicals remains strong 2. Optimise cost and capital Strategies 3. Sustainability although growth softening 4. Improve capabilities and people • Fertiliser earnings development dependent on seasonal • 6 m
Slide 25: Industrial & Safety
Industrial & Safety For personal use only 1. Increase sales to existing customers • Continuing to build stronger 2. Improve metropolitan sale performance business foundations Strategies 3. Target higher growth sectors 4. Improve competitiveness • Enhanced focus on growth • Revenue growth of 7.0% 1H0
Slide 26: Energy
Energy For personal use only • WA LNG project 1. Improve – existing businesses operational Strategies 2. Expand – deliver projects 3. Evaluate - new opportunities • Impacted by Varanus Island gas disruption • Growth in industrial gas sales 1H09 • Gas disruption reduced earnings by Trading ~$15m but
Slide 27: Capital Management
For personal use only Capital Management
Slide 28: Equity Raising
Equity Raising For personal use only • 3 for 7 entitlement offer plus $900m placement • Institutional Entitlement raised $2.0bn • Retail Entitlement raised $1.7bn • Strengthens balance sheet and provides increased flexibility • Extension and refinancing of maturing debt facilities 27
Slide 29: Maturity Profile Analysis
Maturity Profile Analysis For personal use only $bn 3 2 1 0 FY09 FY10 FY11 FY12 FY13 Facility B - Syndicated Facilities Bilateral Facilities Working Capital and Bill Facilities Bonds Note: $4.6bn equity raised however graph above reflects current repayments of $2.9bn. Remaining proceeds to be used t
Slide 30: Capital Management
Capital Management For personal use only • Net Debt to Equity of 49% at 31 December 2008 (20% on a pro-forma basis*) • Cash Interest Cover Ratio of 5.2 times (rolling 12 month basis) • Well within all debt covenants (pre equity raising) • S&P rating BBB+ (stable), Moody’s Baa1 (stable) • Weighted av
Slide 31: Cashflow
Cashflow (Half Year to 31 Dec) For personal use only • Focus on working capital management • Strong free cash flows 2,000 200% 1,600 160% 1,200 120% 800 80% 400 40% 0 0% 2004 2005 2006 2007 2008 NPATDA Operating Cash Flow Free Cash Flow Cash Realisation Ratio *adjusted for Stanwell and significant n
Slide 32: Capital Expenditure
Capital Expenditure For personal use only Half Year ended 31 December (A$m) 2008 2007 • Continued focus on prudent Home Improvement & Office Supplies 214 173 capital expenditure Coles 204 93 • Coles capital expenditure Target 51 - Kmart 41 - weighted towards 2H09 Resources 109 95 • Completion of Amm
Slide 33: Outlook
Outlook For personal use only • Challenging global economic environment • Expect turnaround in Coles to gather pace over next 12 months • Lower export coal prices from April 2009 • Lower borrowing costs from reduced debt levels 32
Slide 34: For all the latest news visit www.wesfarmers.com.au
For personal use only For all the latest news visit www.wesfarmers.com.au 33
Slide 35: Investment Conference Discussion Pack
For personal use only Investment Conference Philosophy, Performance and Direction Citigroup, London – 9 & 10 March Goldman Sachs JBWere, New York – 12 & 13 March JPMorgan, Singapore and Hong Kong – 16 & 17 March March 2009 Discussion Pack 1
Slide 36: Index
Index For personal use only 1 Philosophy, Performance and Direction 3 2 Sustainability 8 3 Group Overview 12 4 2009 Half Year Results 16 5 Operating Divisions 30 6 Capital Management 65 7 Outlook 69 8 Investor Relations Contacts and Information 70 2
Slide 37: Philosophy, Performance and Direction
For personal use only Philosophy, Performance and Direction
Slide 38: Long-term, consistent strategies
Long-term, consistent strategies For personal use only MANAGING BALANCE SHEET EFFECTIVELY 4
Slide 39: Key Attributes (Retail)
Key Attributes For personal use only Growth Quality Earnings Opportunities Assets Improvement • Continued store roll-out; • National store networks; • Bunnings 1H09 cash sales Range expansion; Leading in sectors comp of 7.7%; EBIT up 14% Home Improvement Officeworks turnaround • Officeworks 1H09 ret
Slide 40: Key Attributes (Other Divisions)
Key Attributes For personal use only Growth Quality Earnings Opportunities Assets Improvement • Long term demand; • Sizeable production • Maintaining lowest quartile Resources Curragh & Bengalla capacity; Consistent cash cost production of feasibility studies quality, low costs export coal • Broker
Slide 41: A History of Strong Returns
A History of Strong Returns EPS WES Share For personal use only (cents per share) Price(A$) 300 50 250 40 200 30 150 20 100 50 10 0 0 98 99 00 01 02 03 04 05 06 07 08 EPS (AGAAP) Girrah EPS Landmark EPS EPS (AIFRS) ARG EPS Wesfarmers Share Price * Adjusted for capital reconstructions Jun-98 Jun-99 J
Slide 42: Sustainability
For personal use only Sustainability
Slide 43: Sustainability
Sustainability For personal use only Financial performance • All our actions are directed towards satisfying our corporate objective of providing a satisfactory return to shareholders. To be sustainable, Wesfarmers must continue to achieve high standards of financial performance thereby allowing us
Slide 44: Sustainability
Sustainability For personal use only Environmental responsibility Wesfarmers is a • Our diverse range of businesses expose us to a number of challenging or member of the Dow potentially challenging environmental issues, including waste disposal, contamination and greenhouse gas emissions. We set leg
Slide 45: Sustainability
Sustainability For personal use only Sustainability reporting • Voluntarily publicly reporting on sustainability issues since 1998/99. The stand-alone Sustainability Report is published to coincide with the company's Annual General Meeting. The 2008 report runs to more than 130 pages of very detaile
Slide 46: Group Overview
For personal use only Group Overview
Slide 47: Financial Summary
Financial Summary For personal use only FY07 FY08 1H09 % Change pcp Operating Results Revenue A$m 9,754 33,584 26,363 168.8 EBITDA A$m 1,650 2,897 2,236 76.6 Earnings before interest and tax A$m 1,305 2,243 1,759 68.2 Net profit after tax A$m 786 1,069 879 46.3 Financial Position Total assets A$m 12
Slide 48: Divisional Summary – 1H09
Divisional Summary – 1H09 For personal use only 1H09 Activities 1H09 EBIT^ Revenue (A$m) (A$m) Australia and New Zealand's leading supplier of home improvement Home Improvement & and outdoor living products, office products, and a major supplier of 3,611 395 Office Supplies building materials. The d
Slide 49: Divisional Summary (cont.)
Divisional Summary (cont.) For personal use only 1H09 Activities 1H09 EBIT^ Revenue (A$m) (A$m) Resources Mining of metallurgical and steaming coal to domestic and export markets 1,427 686 Provider of underwriting, broking, premium funding, software development and Insurance financial services activ
Slide 50: 2009 Half Year Results
For personal use only 2009 Half Year Results
Slide 51: Group Performance Highlights
2009 Half Year Results Performance Highlights Group Performance Highlights For personal use only Half Year ended 31 December ($m) 2008 2007* % Operating revenue 26,363 9,808 168.8 • Significant increases in revenue and EBITDA 2,236 1,266 76.6 earnings EBIT 1,759 1,046 68.2 – Inclusion of full period
Slide 52: Provisions and write-downs
Provisions and write-downs For personal use only Period ended 31 December ($m) 2008 Comment Coles (65) Coles Property writedown DC Closure and Kmart (14) restructure costs Non-trading items (79) Self Insurance (48) Increase in provisions Investments (21) Mark-to-market of investments One-off trading
Slide 53: Divisional Performance Overview
2009 Half Year Results Performance Highlights For personal use only Divisional Performance Overview Half Year ended 31 December ($m) 2008 2007* % • 1H09 includes a full period of ownership Home Improvement & Office Supplies 395 332 19.0 Coles 431 130 n.m. of Coles, Target, Kmart and Officeworks Targ
Slide 54: Home Improvement & Office Supplies 2009 Half Year Performance
Home Improvement & Office Supplies 2009 Half Year Performance For personal use only Highlights Financial Performance Half Year ended 31 December ($m) 2008 2007 % Home Improvement • 10.3 % cash sales growth Revenue Home Improvement 3,009 2,795 7.7 Office Supplies 602 115* n.m. • 1.6% lift in trade sa
Slide 55: Coles – 2009 Half Year Performance
Coles – 2009 Half Year Performance For personal use only Highlights Financial Performance Half Year ended 31 December ($m) 2008 2007* • Food & Liquor Sales Revenue 14,626 2,919 – Q2 comparative stores sales growth of 3.8% EBITDA 628 175 Depreciation & Amortisation (197) (45) – Improving growth trend
Slide 56: Target – 2009 Half Year Performance
Target – 2009 Half Year Performance For personal use only Highlights Financial Performance • EBIT margin strength maintained at 10.3% Half Year ended 31 December ($m) 2008 2007* • Comp Store sales growth for the half 4.0% (Q2 growth Revenue 2,094 605 4.8%) EBITDA 245 123 • Outstanding Christmas trad
Slide 57: Kmart – 2009 Half Year Performance
Kmart – 2009 Half Year Performance For personal use only Highlights Financial Performance • Average trading performance Half Year ended 31 December ($m) 2008 2007* – Christmas trading helped deliver 2Q09 comp Revenue 2,249 692 growth of 1.0% EBITDA 100 106 – Apparel and toys were the strongest perfo
Slide 58: Resources – 2009 Half Year Performance
Resources – 2009 Half Year Performance For personal use only Highlights Financial Performance • Record half year production and sales levels Half Year ended 31 December ($m) 2008 2007 % Revenue 1,427 530 169.2 • Record prices for metallurgical and steaming coal EBITDA 791 179 341.9 • Significant inc
Slide 59: Insurance – 2009 Half Year Performance
Insurance – 2009 Half Year Performance Highlights Financial Performance For personal use only • Turnaround of Lumley New Zealand Half Year ended 31 December ($m) 2008 2007 % • Rate increases achieved in motor portfolios Gross Written Premium Underwritten 679 618 9.9 EBITA Underwriting 44 38 15.8 • H
Slide 60: Industrial & Safety – 2009 Half Year Performance
Industrial & Safety – 2009 Half Year Performance For personal use only Highlights Financial Performance • Continued focus on safety resulting in reduction in lost Half Year ended 31 December ($m) 2008 2007 % days and severity of injuries Revenue 687 642 7.0 • Customer service and delivery performanc
Slide 61: Chemicals & Fertilisers – 2009 Half Year Performance
Chemicals & Fertilisers – 2009 Half Year Performance For personal use only Highlights Financial Performance % • Six months successful operation of AN Expansion Half Year ended 31 December ($m) 2009 2008 Revenue Chemicals 291 218 33.5 • Debottlenecking of QNP complete. Commissioning Fertilisers 167 1
Slide 62: Energy – 2009 Half Year Performance
Energy – 2009 Half Year Performance For personal use only Highlights Financial Performance Half Year ended 31 December ($m) 2008 2007 % • Western Australian LNG project operational Revenue 322 281 14.6 • Growth in industrial gas sales EBITDA 52 66 (21.2) • Maintained LPG supply through Varanus Islan
Slide 63: Other Businesses – 2009 Half Year Performance
Other Businesses – 2009 Half Year Performance For personal use only Highlights Financial Performance Holding Half Year ended 31 December (A$m) 2008 2007 % Gresham Private Equity – Fund 1 Associates: Gresham Private Equity - Fund 1 51 (2) 3 • Riviera only remaining investment Gresham Private Equity -
Slide 64: Operating Divisions
For personal use only Operating Divisions
Slide 65: Home Improvement & Office Supplies
Home Improvement & Office Supplies For personal use only WIDEST RANGE LOWEST PRICES BEST SERVICE 31
Slide 66: Store Network
Store Network at December 2008 For personal use only 2 171 Bunnings Warehouse Stores 59 Small format Bunnings Stores 112 Officeworks Stores 29 5 22 20 9 8 2 8 11 51 17 38 38 12 25 43 2 1 4 2 Excludes 19 Trade operational sites and 5 Harris Technology stores 32
Slide 67: Home Improvement & Office Supplies Performance
Home Improvement & Office Supplies Performance For personal use only EBIT A$m ROC % GrowthStrategies Growth Strategies 700 35 HomeImprovement Home Improvement Strategies Strategies 600 30 Improvingservice Improving service Continuedoffer Continued offerimprovement improvement 500 25 Profitablesales
Slide 68: Office Supplies
Office Supplies For personal use only Officeworks Strategies New concept store trial Re-establishing range authority Improving the customer offer Replenishment process enhancements Website being re-built Investment in additional in-store wages Non-sell task reviews generating face-to-face service ho
Slide 69: Coles
For personal use only Coles 35
Slide 70: Coles Store Network
Coles Store Network at December 2008 For personal use only Selling Area Supermarkets (sqm) 1,591,279 7 8 11 Liquor (sqm) 273,181 154 232 77 81 90 5 116 67 63 31 6 43 252 248 5 208 161 765 Supermarkets 194 163 772 Liquor stores 93 Hotels 14 15 621 Convenience 36
Slide 71: Coles – Strategy years – phases of recovery
Coles – Strategy 5 years – 3 phases of recovery For personal use only Building a Solid Delivering Driving the Coles Foundation Consistently Well Difference Performance • Culture of continuous • Embed the new culture improvement • Create a strong top team • Team member development • Strong customer t
Slide 72: Coles – Strategy
Coles – Strategy Phase 1 Progress For personal use only Create a strong top team 100% of leadership team new to Coles/role with over 125 years of retailing experience. 45% of top 200 managers new to Coles/role. Cultural change 1,500+ non-store positions removed. Store manager authority improved. Sto
Slide 73: Target
For personal use only Target 39
Slide 74: Target Store Network
Target Store Network at December 2008 For personal use only 3 54 31 25 97 68 283 Target stores (incl 116 Target Country) 5 40
Slide 75: Target - Strategies
Target - Strategies For personal use only Strategies Details Focus on fundamentals Meeting customer needs on Range, Price and Service Evolution of “100% Happy” Brand relaunch Unique philosophy and positioning Leveraging an emotional connection Bringing the best of what’s new in the world to Target D
Slide 76: Kmart
For personal use only Kmart 42
Slide 77: Kmart Store Network
Kmart Store Network at December 2008 For personal use only 2 3 36 52 20 32 13 20 50 73 12 183 Kmart stores 42 77 263 KTAS centres 5 6 3 43
Slide 78: Kmart – Strategies
Kmart – Strategies For personal use only The renewal of Kmart • Fix the customer experience • Significantly reduce cost base • Rebuild customer trust • Make every site a success • Right people and accountability 44
Slide 79: Resources
For personal use only Resources 45
Slide 80: Resources - Locations
Resources - Locations For personal use only Coal Premier Coal Curragh Bengalla (40%) 46
Slide 81: Resources - Performance
Resources - Performance For personal use only EBIT A$m ROC % Growth Strategies 800 100 Opportunities / Challenges Strategic initiatives 700 90 Long-term contracts in place 80 Maximise export sales and 600 Price relativity optimise sales mix 70 Maximise higher value products 500 60 Improve operationa
Slide 82: Resources - Sales
Resources - Sales Coal Sales Volumes by Mine (FY08) Hard Coking Coal Prices (US$/t FOB Australia) For personal use only Mine Domestic Export Export 400 Total (mtpa) Steaming Steaming Metallurgical 350 300 250 Curragh, QLD 2.4 6.5 8.9 200 Premier, WA 2.9 2.9 150 100 Bengalla*, NSW 1.0 4.6 5.6 50 0 To
Slide 83: Hedging profile
Hedging profile as at 31 December 2008 For personal use only Curragh – Open Contracts Bengalla – Open Contracts Current US$ Average Current US$ Average Year end Year end sold forward A$ / US$ sold forward A$ / US$ 30 Jun 30 Jun (US$m) hedge rate (US$m) hedge rate 2009* 264 0.82 2009* 55 0.80 2010 31
Slide 84: Insurance
For personal use only Insurance 50
Slide 85: Insurance - Locations
Insurance - Locations For personal use only 3 1 1 6 3 13 4 21 1 2 1 1 4 13 8 18 11 6 17 6 2 Lumley General Australia 13 6 10% Lumley General New Zealand 10 3 4 1 Wesfarmers Federation Insurance 85 2 OAMPS 33 Crombie Lockwood 17 51
Slide 86: Insurance - Performance
Insurance - Performance EBIT A$m ROC % Growth Strategies For personal use only 160 35 Opportunities Strategies 140 30 Australian license/capital consolidation Underwriting Business improvement System alignment and upgrade 120 25 Enhanced focus on risk selection 100 Capital Strengthen MCR to achieve
Slide 87: Insurance – Underwriting Performance
Insurance – Underwriting Performance For personal use only Key Performance Indicators 1H09 Gross Written Premium by Class of Business Half Year ended 31 December (%) 2008 2007 %pt Total $679m Personal Liability Gross Earned Loss Ratio 68.0 69.6 1.6 $135 $128 Net Earned Loss Ratio 68.9 67.4 (1.5) Rei
Slide 88: Industrial & Safety
Industrial & Safety For personal use only Australia New Zealand “All your Safety Industrial workplace needs” Specialist Specialists (formerly Mullings Fasteners) 54
Slide 89: Industrial & Safety – Distribution Network
Industrial & Safety – Distribution Network For personal use only Australia No. 2 72 MRO, “All your workplace needs” 1 1 17 6 Electrical 15 6 12 7 9 5 9 4 43 Safety 1 1 55 21 Materials handling, lifting, rigging 5 2 17 1 6 3 Fasteners 16 5 1 8 Engineering 11 5 New Zealand No. 7 2 3 1 1 1 20 MRO, hose
Slide 90: Industrial & Safety - Performance
Industrial & Safety - Performance For personal use only EBIT A$m ROC % Growth Strategies 140 18 Opportunities Strategic Initiatives 16 120 DIFOT performance continued to improve 14 Increase sales to existing 100 Investment in sales force underway customers 12 Further enhanced value proposition 80 10
Slide 91: Chemicals & Fertilisers
Chemicals & Fertilisers For personal use only 57
Slide 92: Chemicals & Fertilisers - Locations
Chemicals & Fertilisers - Locations For personal use only ■ CSBP fertilisers Manufacturing plant 5 Import and distribution centres 5 Depots 6 Regional Sales Representatives 27 Sales agents 135 ■ CSBP chemicals Manufacturing plants 10 ■ AV Manufacturing plants 2 ■ QNP (50%) Manufacturing plants 4 58
Slide 93: Chemicals & Fertilisers – Performance
Chemicals & Fertilisers – Performance For personal use only EBIT A$m ROC % Growth Strategies 140 20 Strategic initiatives Comment 120 16 Growth 3 • Kwinana duplication (+235,000 tpa) 100 WIP • Upgrade of QNP (+30,000 tpa) underway 12 80 WIP • Sodium cyanide expansion 60 Optimise cost and capital 3 •
Slide 94: Energy
For personal use only Energy 60
Slide 95: Energy - locations
Energy - locations For personal use only Industrial, medical and specialty gases Air separation units (ALWA) Air separation units (Coregas) Hydrogen/acetylene plants (Coregas) 2 1 1 1 Industrial gas depots/branches (ALWA) 1 Industrial gas depots/branches (Coregas) 1 LPG & LNG 14 5 LPG depots/branche
Slide 96: Energy - Performance
Energy - Performance For personal use only Growth Strategies EBIT A$m ROC % 100 50 Strategies Segment Industrial gas growth in: 90 • eastern states sales; & 80 40 • oil and gas sector 70 Maximise LPG production Improve – Existing Businesses LPG distribution: 60 30 • customer focus; & 50 • controllab
Slide 97: Energy - Businesses
Energy - Businesses For personal use only Activities Activities distributor and marketer of LPG and LNG and Activities Production, distribution and marketing of gas appliances to a broad range of domestic, design, construction, operatation and industrial and medical gases on Australia’s east commerc
Slide 98: Other Businesses
Other Businesses For personal use only Gresham: 50% interest in Gresham Partners, an independent investment (A$m) 2007 2008 bank focused on financial advisory services, private equity investment and property investment funds. Wesfarmers also Profit before tax: holds significant investments in Gresha
Slide 99: Capital Management
Capital Management For personal use only • Net Debt to Equity of 49% at 31 December 2008 (20% on a pro-forma basis*) • Cash Interest Cover Ratio of 5.2 times (rolling 12 month basis) • Well within all debt covenants (pre equity raising) • S&P rating BBB+ (stable), Moody’s Baa1 (stable) • Weighted av
Slide 100: Maturity Profile Analysis
Maturity Profile Analysis For personal use only $bn 3 2 1 0 FY09 FY10 FY11 FY12 FY13 Facility B - Syndicated Facilities Bilateral Facilities Working Capital and Bill Facilities Bonds Note: $4.6bn equity raised however graph above reflects current repayments of $2.9bn. Remaining proceeds to be used t
Slide 101: Hedging Profile
Hedging Profile For personal use only • At 31 Dec 08, ~50% of debt hedged for 5 years at average 7.2% (excluding margins) • Rebalancing of hedge positions underway • Post rebalancing, expect debt to be ~50% hedged for 5 years at average 7.2% (excluding margins) • Expect to realise ~$150m of hedge lo
Slide 102: Capital Expenditure
Capital Expenditure For personal use only Half Year ended 31 December (A$m) 2008 2007 • Continued focus on prudent Home Improvement & Office Supplies 214 173 capital expenditure Coles 204 93 • Coles capital expenditure Target 51 - Kmart 41 - weighted towards 2H09 Resources 109 95 • Completion of Amm
Slide 103: Outlook
Outlook For personal use only • Challenging global economic environment • Expect turnaround in Coles to gather pace over next 12 months • Lower export coal prices from April 2009 • Lower borrowing costs from reduced debt levels 69
Slide 104: Investor Relations Contact
Investor Relations Contact For personal use only Wesfarmer’s Public Affairs and Investor Relations For further information on Wesfarmers including: Anna McPhee 61 8 9327 4478 (media) amcphee@wesfarmers.com.au Annual reports Financial results announcements Tanya Rybarczyk 61 8 9327 4323 Presentations
Wesfarmers — Citigroup, Goldman Sachs JBWere and JPMorgan Investment Conferences 2009 on 6ix