Wesfarmers Limited · ASX:WES
Wesfarmers — Debt Investor Presentation (February 2023)
22 slides from Wesfarmers's debt investor presentation, February 2023
Slide 1: 2023 Half-year results debt investor update
2023 Half-year results debt investor update
Slide 2: Group performance overview
Group performance overview 7 Wesfarmers
Slide 3: Wesfarmers' primary objective is to provide a satisfactory return to shareholders
Wesfarmers’ primary objective is to provide a satisfactory return to shareholders We believe it is only possible to achieve this over the long term by: Anticipating the needs of our Looking after our team Engaging fairly with our customers and delivering members and providing a safe, suppliers, and
Slide 4: 2023 Half-year highlights
2023 Half-year highlights Increase in profit and Largest divisions Responding well interim dividend particularly strong to market conditions Pleasing financial $22.6b revenue +114.0% Kmart Group EBT Value credentials results for the half $1.4b NPAT, up 14.1% +48.6% WesCEF EBT Strong operating result
Slide 5: Divisional highlights
Divisional highlights Bunnings Kmart WesCEF Officeworks Group Group • Increased demand across key categories that were impacted • Performance highlights • Significant sales and earnings • Record earnings for the half by lockdowns in 1H22 resilience of operating model growth with strong execution • S
Slide 6: Focus on long-term value - consistent with our ESG objectives
Focus on long-term value - consistent with our ESG objectives Climate & environment People Communities increase in Scope 1 and 2 total recordable injury direct and indirect 7.3% market-based emissions, 11.4 frequency rate (TRIFR) and $36m community contributions due to increased ammonia a continued
Slide 7: Group performance summary
Group performance summary Half-year ended 31 December ($m) 2022 2021 Var % Revenue 22,558 17,758 27.0 Revenue (excl. Health) 19,780 17,758 11.4 EBIT 2,160 1,905 13.4 EBIT (after interest on lease liabilities) 2,053 1,796 14.3 NPAT 1,384 1,213 14.1 Basic earnings per share (cps) 122.3 107.3 14.0 Retu
Slide 8: Divisional sales performance
Divisional sales performance Sales performance ($m) Half-year ended 31 December 2021 2022 Retail sales1 GTV Revenue Total sales +6.3% K+T: +24.5% +4.6% (26.8%) +30.2% +3.6% growth Comp sales +2.8% +17.1% +2.8% growth 9,782 9,204 4,531 3,487 2,778 1,167 1,263 1,571 1,644 1,402 616 1,077 944 978 451 B
Slide 9: Divisional earnings performance
Divisional earnings performance EBT1 Performance and earnings results reflect: 1H23 Bunnings • Strong commercial growth and continued consumer growth $1,278m Group • Increased foot traffic to stores and shopping frequency as customer behaviour normalised ↑ 1.5% • Continued focus on value, with price
Slide 10: Working capital and cash flow
Working capital and cash flow Net working capital cash movement • Divisional operating cash flows increased 13.4%, Half-year ended 31 December ($m) 2022 2021 with divisional cash generation of 97%1 – Growth in divisional earnings Receivables and prepayments 74 189 – Strong cash generation in Kmart a
Slide 11: Capital expenditure
Capital expenditure • Gross cash capital expenditure of $676m, up 16.0% Half-year ended 31 December1 ($m) 2022 2021 Var % – WesCEF includes $204m of development capex and $21m of capitalised interest relating to the Bunnings 226 196 15.3 Mt Holland lithium project Kmart Group2 62 62 - – Increased in
Slide 12: Group outlook
Group outlook • Remain focused on long-term value creation • Strong balance sheet and portfolio of cash-generative businesses with market-leading positions provide the flexibility to respond to risks and opportunities under a range of economic scenarios • Elevated inflation and higher interest rates
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 Half-year update • Maintaining prudent capital structure and • Benefits of recent actions to reposition strong credit rating is important to balance sheet and optimise cost of funds Wesfarmers – Weighted average cost of debt2 declined to • Stron
Slide 15: Pro-active debt management
Pro-active debt management • Continued focus on optimising debt maturity profile Debt maturity profile1 and maintaining liquidity headroom provided by $m bilateral bank facilities 1,750 1,250 – Repaid €650m (A$764m) ten-year Euro bonds at 750 5.86%, which matured in August 2022 250 (250) – Ongoing e
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: Sustainable finance update
Sustainable finance update March 2020 June 2021 October 2021 A$450m sustainability-linked loan A$1b sustainability-linked bond €600m sustainability-linked bond • Achieving proportional representation for • Increasing the use of renewable electricity in the Group’s retail Aboriginal and Torres Strait
Slide 18: Management of lease portfolio
Management of lease portfolio • Lease liabilities totalled $6.9b and Lease liabilities ($m) 1H23 FY22 1H22 represented 58% of Group fixed financial Bunnings 3,738 3,692 3,854 obligations as at 31 December 2022 Kmart Group2 2,411 2,616 2,764 • Average remaining committed lease term of WesCEF 64 61 50
Slide 19: Dividends & capital management
Dividends & capital management Key principles Half-year update • Dividend distributions determined based on • Fully-franked ordinary interim dividend of franking credit availability, earnings, credit $0.88 per share metrics and cash flow • Dividend record date: 21 February 2023 – Maximising value of
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
We Wesfarmers
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