Wesfarmers Limited · ASX:WES
Wesfarmers — Debt Investor Presentation (2023)
22 slides from Wesfarmers's debt investor presentation, 2023
Slide 1: 2023 Full-year results debt investor update
2023 Full-year results debt investor update
Slide 2: Group performance overview
AX 4. ant Group performance overview 7 Wesfarmers
Slide 3: Wesfarmers' primary objective is to deliver a satisfactory return to shareholders
Wesfarmers’ primary objective is to deliver a satisfactory return to shareholders We believe it is only possible to achieve this over the long term by – Anticipating the needs of Looking after our team Engaging fairly with our our customers and members and providing suppliers, and sourcing deliverin
Slide 4: 2023 Full-year highlights
2023 Full-year highlights Group NPAT growth of 4.8% to $2.5b $43.5b $3.85b $1.91 as businesses Revenue Divisional EBT Full-year dividend respond well to +18.2% YoY +12.9% YoY +6.1% YoY market conditions (+7.4% excl. (+10.8% excl. Fully-franked Wesfarmers Health) Wesfarmers Health) Strong value crede
Slide 5: Results underpinned by strong divisional performance
Results underpinned by strong divisional performance Combined divisional earnings growth of 12.9% as the Group’s operating businesses continue to respond well to trading and market conditions Strong execution from Continued investment to support Realised benefits from productivity well-positioned bu
Slide 6: Divisional highlights
Divisional highlights Bunnings Kmart Group WesCEF Officeworks Sales Earnings Sales1 Earnings1 Sales Earnings Revenue Earnings $18.5b $2,230m $10.5b $769m $3.3b $200m $3.3b $669m ↑ 4.4% ↑ 1.2% ↑ 16.9% ↑ 52.3% ↑ 6.0% ↑ 10.5% ↑ 8.7% ↑ 23.9% • Performance highlights • Significant sales and • Strong oper
Slide 7: Executing on growth projects
Executing on growth projects Covalent Lithium project Wesfarmers Health • Attractive long-term demand outlook for battery electric • Transformation plan underway in core API businesses, vehicles driving a period of investment for the division • Construction of mine completed and commissioning of the
Slide 8: Focus on long-term value, consistent with our objective
Focus on long-term value, consistent with our objective Climate and environment People Communities reduction in Scope 1 and total recordable injury 2.4% Scope 2 market-based 11.3 frequency rate (TRIFR) and a $75m direct and indirect community contributions emissions supported by continued focus on s
Slide 9: Group performance summary
Group performance summary Year ended 30 June ($m)1 2023 2022 Var % Revenue 43,550 36,838 18.2 Revenue (excluding Wesfarmers Health) 38,238 35,598 7.4 EBIT 3,863 3,633 6.3 EBIT (after interest on lease liabilities) 3,644 3,416 6.7 NPAT 2,465 2,352 4.8 Basic earnings per share (cps) 217.8 207.8 4.8 Re
Slide 10: Working capital and cash flow
Working capital and cash flow • Divisional operating cash flows increased 45.6%, Net working capital cash movement with divisional cash generation of 101%1 Year end 30 June ($m) 2023 2022 – Excluding Wesfarmers Health, divisional cash flow Receivables and prepayments 41 (272) increased 40.7%, with c
Slide 11: Capital expenditure
Capital expenditure • Gross capital expenditure of $1.3b, up 12.6% Capital expenditure – WesCEF includes development capex of $394m Year ended 30 June1 ($m) 2023 2022 Var % and capitalised interest of $42m relating to the Mt Holland mine and concentrator and Bunnings 405 349 16.0 Kwinana refinery Km
Slide 12: Group outlook
Group outlook • Wesfarmers remains focused on long-term value creation and continues to invest to strengthen its existing businesses and develop platforms for growth • First earnings from Lithium are expected in 2H FY24 as production of spodumene concentrate ramps up • WesCEF’s earnings from its exi
Slide 13: Balance sheet & debt management
Balance sheet & debt management
Slide 14: Strong balance sheet and credit ratings
Strong balance sheet and credit ratings Key principles Full-year update • Maintaining prudent capital structure and strong • Continue to focus on balance sheet and cost of credit ratings is important to Wesfarmers funds • Strong credit ratings – Weighted average cost of debt for the year – Moody’s A
Slide 15: Pro-active debt management
Pro-active debt management Debt maturity profile1 • Continue to focus on optimising debt maturity profile $m and maintaining liquidity headroom provided by 2,250 bilateral bank facilities 1,750 – Repaid €650m (A$764m) ten-year Euro bonds at 1,250 750 5.86%, which matured in August 2022 250 – Ongoing
Slide 16: Debt capital markets diversity
Debt capital markets diversity • Ongoing commitment to diversify funding sources, DCM geographical sources1 including the domestic and international debt capital markets • Australian and European debt capital market programme documentation updated on an ongoing basis to ensure continued and ready SL
Slide 17: Sustainability-linked bond update
Sustainability-linked bond update • Since the sustainability-linked bonds were issued, WesCEF, Bunnings, Kmart Group and Officeworks Scope 2 market-based emissions by division have continued to make good progress on the sustainability-linked targets, as reported in March 20231 • Among the retail bus
Slide 18: Management of lease portfolio
Management of lease portfolio • Lease liabilities totalled $6.7b and Lease liabilities ($m) 2023 2022 represented 60% of Group fixed financial Bunnings 3,568 3,692 obligations as at 30 June 2023 Kmart Group1 2,341 2,616 • Average remaining committed lease term of WesCEF 61 61 4.1 years3 (FY22: 4.4 y
Slide 19: Shareholder distributions
Shareholder distributions • Fully-franked final ordinary dividend of $1.03 per Shareholder distributions1 share $/share – Reflects strong operating performance 5.00 – Takes full-year ordinary dividend to 4.00 3.78 $1.91 per share • Final dividend will also carry a New Zealand 3.00 2.78 2.00 franking
Slide 20: Questions
Questions
Slide 21: Additional resources
Additional resources • Wesfarmers debt investor website https://www.wesfarmers.com.au/investor-centre/debt-investors/debt-overview • Wesfarmers sustainable finance website https://www.wesfarmers.com.au/investor-centre/debt-investors/sustainable-finance • Group Treasury email address debt@wesfarmers.
Slide 22: Wesfarmers
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