Slide 1: 2009 Full Year Results Supplementary Information
2009 Full Year Results Supplementary Information (To be read in conjunction with the Full Year Results Teleconference presentation) 20 August 2009
Slide 2: Table of Contents
Table of Contents 1 G Group Performance P f 3 2 Coles 5 3 H Home IImprovementt & Office Offi Supplies S li 8 4 Target 12 5 K Kmart t 16 6 Resources 22 7 I Insurance 33 8 Industrial & Safety 39 9 Ch i l & Fertilisers Chemicals F tili 45 10 Energy 52 11 Other Businesses B sinesses 55 2
Slide 3: Group Performance
Group Performance
Slide 4: Movement in Shares on Issue
Movement in Shares on Issue m shares 1,200 63.2 15.4 5.0 1,000 128.7 145.4 800 600 1,157.1 400 799.4 200 0 1 July 2008 Rights Issue Rights Issue Placement DIP Other 30 June 2009 Institutional Retail Offer Offer 4
Slide 5: Coles
coles BFLO f CHOICE vo~ Vinrace Ceuars COIES WHY PAY MORE! Liquor Su oa
Slide 6: Our customer franchise
Our customer franchise at 30 June 2009 Selling Area 7 8 11 Supermarkets (sqm) 1,600,578 Liquor (sqm) – ex hotels 173,886 153 230 78 81 93 6 117 67 62 30 6 43 251 252 5 211 161 195 162 763 Supermarkets 14 15 q 775 Liquor stores 95 Hotels 625 Convenience 6
Slide 7: Improving our customer franchise
Improving our customer franchise… franchise Open at Open at Opened Closed 30 June 2008 30 June 2009 Supermarkets Coles 685 31 11 705 Bi-Lo 65 - 7 58 Total Supermarkets 750 31 18 763 Liquor 1st Choice 52 12 - 64 Vintage Cellars 85 1 6 80 Liquorland 630 17 16 631 H t l Hotels 95 2 2 95 Total Liquor 86
Slide 8: Home Improvement & Office Supplies
Home Improvement & Office Supplies
Slide 9: Bunnings Network
Bunnings Network at 30 June 2009 175 Warehouse stores 56 Smaller format stores 2 22 Trade Centres 29 5 7 22 7 3 8 2 1 53 16 5 12 25 43 5 4 2 1 1 9
Slide 10: Officeworks & Harris Technology Network
Officeworks & Harris Technology Network at 30 June 2009 Retail Stores 123 Officeworks 5 Harris Technology gy 24 1 1 Business 11 1 1 4 Fulfilment Centres 8 3 Service Centres 40 2 1 2 38 1 1 1 2 10
Slide 11: Store Network Movements
Store Network Movements 6mths to 30 June 2009 Under Dec 2008 Opened Closed Jun 2009 construction Home Improvement Bunnings Warehouse 171 4 0 175 10 Bunnings smaller formats 59 1 4 56 1 Bunnings Trade Centres 19 4 1 22 3 Frame & Truss plants 8 0 1 7 - Office Supplies Officeworks 119 4 - 123 3 Harris
Slide 12: Target
Wesfarmers
Slide 13: Target Performance - 2H09 vs 2H08
Target Performance - 2H09 vs 2H08 ($m) 2H09 2H08 % Revenue 1,694 1,593* 1,593 6.3 EBIT 142 103 37.9 EBIT margin i (%) 8.4 6.5 1.9pt Comp. store sales growth (%) 4.4 3.4 *Includes two additional trading days due to the re-alignment of the Coles and Wesfarmers reporting calendars 13
Slide 14: Target Store Network
Target Store Network at 30 June 2009 3 56 31 26 97 68 286 Target stores ((incl 116 Target g Country) y) 5 14
Slide 15: Store Network Movements
Store Network Movements Under Dec 2008 Opened Closed Jun 2009 construction Target 167 3 0 170 3 Target Country 116 2 2 116 1 • One of the Target openings is a replacement store, ie: a Target Country closure. 15
Slide 16: Kmart
Kmart ve _ C- ] g = Tyre & Auto Service Wesfarmers
Slide 17: Kmart Performance – 2H09 vs 2H08
Kmart Performance – 2H09 vs 2H08 Year ended 30 June ($m) 2H09 2H08 % Revenue 1,750 , 1,762* , ((0.7)) EBIT^ 34 10 240.0 EBIT margin (%) 1.9 0.6 1.3pt Comparative store sales growth (%) 0.0 1.2 (1.2)pt *Includes 1 additional trading day due to the re-alignment of the Coles and Wesfarmers reporting ca
Slide 18: Kmart Store Network
Kmart Store Network at 30 June 2009 184 Kmart stores 255 KTAS centres 2 3 36 52 20 28 13 20 50 72 12 43 74 5 6 3 18
Slide 19: Store Network Movements
Store Network Movements Under Dec 2008 Opened Closed Jun 2009 construction Kmart 183 1 - 184 1 Kmart Tyre & Auto 263 - 8 255 - 19
Slide 20: Resources
Wesfarmers
Slide 21: Coal Production – Resources Division
Coal Production – Resources Division • Curragh C h t tonnes (m) ( ) 16 – Record coal production 14 – Mix change due to lower PCI demand 12 • Premier 10 – Increased sales to Verve Energy 8 • Bengalla 6 – Port constraints impacting production 4 2 0 2002 2003 2004 2005 2006 2007 2008 2009 21
Slide 22: Coal – Production Volumes
Coal – Production Volumes Y Year ended d d Mine Beneficial Coal Type ('000 tonnes) Interest Jun-09 Jun-08 Curragh, QLD 100% Metallurgical 6,711^ 6,888 Steaming 2 925 2,925 2 484 2,484 Premier, WA 100% Steaming 3,366 2,774 Bengalla, NSW 40% Steaming 2,105 2,172 Total* 15,107 14,318 ^ Includes 400kt o
Slide 23: Seaborne Metallurgical Coal Market
Seaborne Metallurgical Coal Market CONSTRAINED SUPPLY REBOUNDING DEMAND Australia rail & port China imports increase constraints re-emerging g g (June YTD 30 mtpa rate) (Hay Point ship loader down / 50 vessels DBCT) Recommencement of US high cost mines closed steel production (ex China) Seaborne Met
Slide 24: Australian coal market prices
Australian coal market prices p Steaming coal Hard coking coal US$/Tonne (Nominal) FOB Australia (annual verse spot) US$/Tonne (Nominal) FOB Australia (annual verse spot) 200 400 350 160 300 250 120 200 80 150 100 40 50 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2003 2004 2005 2006 2007 2008 2009 2
Slide 25: Coal – Sales Volumes
Coal – Sales Volumes Beneficial Year ended Mine Coal Type Interest ('000 tonnes) Jun-09 Jun-08 Curragh, QLD 100% Metallurgical 6,454 6,548 Steaming g 3,325# 2,418 Premier, WA 100% Steaming 3,432 2,864 Bengalla, NSW 40% Steaming 2,065 2,228 Total * 15 276 15,276 14 058 14,058 # Includes I l d 953kt o
Slide 26: Curragh Metallurgical Sales Growth
Curragh Metallurgical Sales Growth • Sales volumes is forecast to be in the range of 6 6.2 2 to 6 6.7mt 7mt tonnes (m) 7 6 Wesfarmers ownership 5 4 3 2 1 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 26
Slide 27: Curragh Metallurgical Sales Mix
Curragh Metallurgical Sales Mix Semi Hard Hard 25% Hard Semi Hard 44% 47 - 50% 20% PCI PCI 31% % 30 - 33% 2008/09 actual 2009/10 estimate 6.5 million tonnes 6.2 - 6.7 million tonnes 27
Slide 28: Curragh focus on cost control
Curragh g focus on cost control • Aggressive cost reduction program in place • Up to $90 million of annualised cost reductions implemented since 4Q09 • Strategies targeted include – Mining and processing practices, equipment utilisation and productivities – Procurement optimisation on key input cost
Slide 29: Hedging profile as at 30 June 2009
Hedging profile as at 30 June 2009 Curragh – Open Contracts Bengalla – Open Contracts Current US$ 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 2010 350 0.78 2010 97 0.79 2011 285 0.79 2011 65 0.79 2012 62
Slide 30: Coal delivery systems
Coal delivery systems • Gl d t Gladstone – Short-term rail capacity currently constrained – Ongoing rail duplication projects – Adequate port capacity in place – Wiggins Island Coal Terminal feasibility study continues • Newcastle – Port constraints continue – Ongoing vessel queues and demurrage – S
Slide 31: Demurrage
Demurrage • Constrained export coal chains eased in financial year 2009 $Am 20 18 16 $2.64/t 14 $2.03/t 12 10 8 6 $1.96/t $1.61/t 4 2 0 FY 2008 FY 2009 Curragh Bengalla (40%) 31
Slide 32: Coal port congestion East coast Australia
Coal port congestion East coast Australia as at 31 July 2009 • Port congestion re-emerging No. of ships at anchor 180 160 140 120 100 80 60 40 20 0 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Gladstone Newcastle Other Ports Source: McCloskey Fax 32
Slide 33: Insurance
Insurance 33
Slide 34: Geographical Presence
Geographical Presence 3 1 UK 6 1 3 14 4 19 1 2 1 1 4 16 8 17 11 8 17 6 1 Lumley Insurance (Australia) 12 6 Lumley General New Zealand 10 3 2 WFI 86 1 2 OAMPS 34 Crombie Lockwood 17 34
Slide 35: Underwriting Performance Summary
Underwriting Performance Summary Year ended 30 June ($m) 2009 2008^ 2008 % Gross Written Premium 1,358 1,328 2.3 Net Earned Premium 1,013 947 7.0 Net Claims (738) (629) 17.3 Net Commission and Expenses (307) (309) (0.6) Underwriting Result (32) 9 (455.5) Insurance Margin 11 49 (77.6) EBITA* 33 73 (5
Slide 36: Broking Performance Summary
Broking Performance Summary Year ended 30 June ($m) 2009 2008 % Commission and Fee Income 191 178 7.3 Other Income 27 31 (12.9) Total Income 218 209 43 4.3 Expenses (157) (153) 2.6 EBITA 61 56 8.9 EBIT 51 43 18.6 EBITA Margin (%) 27.9 26.7 1.2 pt 36
Slide 37: Underwriting KPIs
Underwriting KPIs Year ended 30 June (%) 2009 2008 %pt Gross Earned Loss Ratio 79.4 64.8 14.6 Net Earned Loss Ratio 72.9 66.5 6.4 Reinsurance Expenses (% GEP) 23.0 24 6 24.6 (1 6) (1.6) Exchange Commission (% RI excl XOL) 24.7 24.6 0.1 Commission Expense (% GWP) 13 9 13.9 13 9 13.9 - Total Earned Ex
Slide 38: Gross Written Premium (underwriting)
Gross Written Premium (underwriting) T t l $1,358m Total $1 358 Liability Personal $248 $284 $ Marine $59 Engineering $75 Commercial Other $47 $272 Crop $28 Commercial Motor $ $345 38
Slide 39: Industrial & Safety
Industrial & Safety Wesfarmers
Slide 40: Industrial & Safety Business Portfolio
Industrial & Safety Business Portfolio Australia New Zealand “All your Safety Industrial workplace needs” Specialist Specialists (1) (1) Manufacturing and services 40
Slide 41: Industrial & Safety - Distribution Network
Industrial & Safety - Distribution Network 240 locations (163 Australia, 77 New Zealand) Australia No No. 2 69 MRO, “All your workplace needs” 1 1 16 6 Electrical 14 6 12 7 9 5 9 4 Safety 42 2 1 54 22 Materials handling, lifting, rigging 4 2 17 1 6 4 Fasteners 16 4 1 8 Engineering 11 5 New Zealand N
Slide 42: Industrial & Safety Results
Industrial & Safety Results • Operating revenue of $1,294m down 1.1% – Solid performance despite challenging economic environment in second half – Blackwoods and Bullivants performed strongly – Sales to small customers and manufacturing sector most impacted – Substantial slowing in business activity
Slide 43: Business Activity Highlights
Business Activity Highlights • Growth initiatives mitigating downturn impact on volumes and margins – Introduced mobile sales tools and Sales Academy training programme – Further invested in e-business capability, delivering growth in channel – Expanded E d d product d t and d service i offering, ff
Slide 44: Industrial & Safety Outlook
Industrial & Safety Outlook • M k t conditions Market diti expected t d to t remain i challenging h ll i – Lower market demand from manufacturing and small customer base – Infrastructure based activity expected to provide growth opportunities – Margin pressure expected to continue • Focus on improvi
Slide 45: Chemicals & Fertilisers
Chemicals & Fertilise Wesfarmers
Slide 46: Chemicals Performance
Chemicals Performance • Ammonia – Plant production was down 35% due to disruption of gas supplies – Business recorded a loss for the year due to lost production and having to source gas at above contract prices • Sodium cyanide – Lower production and profit as customers adversely impacted by gas dis
Slide 47: Chemicals Performance
Chemicals Performance • Ammonium Nitrate – Strong demand for ammonium nitrate continued with product supplied into local resources sector, manufacture of Flexi-N fertiliser and export markets – Significant ammonia imported throughout the year to overcome disruption of gas supplies • Australian Vinyl
Slide 48: Fertiliser Performance
Fertiliser Performance • Reduction in sales volumes attributable to: – Reduced farmers’ terms of trade in the pasture market – The break to the season was delayed due to one of the driest autumns on record in WA agricultural areas, resulting in later than normal buying decisions – Lower fertiliser a
Slide 49: Fertiliser Sales
Fertiliser Sales kt 1 200 1,200 1,000 800 739 670 813 589 600 612 513 400 200 381 370 387 249 289 226 0 2004 2005 2006 2007 2008 2009 1st Half 2nd Half 49
Slide 50: Global Fertiliser Pricing
Global Fertiliser Pricing USD/t 1300 1200 1100 1000 900 800 00 700 600 500 400 300 200 100 0 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Urea (FOB Middle East) DAP (FOB US Gulf) 50
Slide 51: Global Ammonia & PVC Pricing
Global Ammonia & PVC Pricing USD/t 1400 1300 1200 1100 1000 900 800 700 600 500 400 300 200 100 0 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Am m onia (FOB Middle East) PVC (Harrim an Mid-point) 51
Slide 52: Energy
Wesfarmers
Slide 53: World LPG prices – Saudi CP
World LPG prices – Saudi CP Average CP Average CP Jul 07 - Jun 08 Jul 08 – Jun 09 USD/tonne USD 748 USD 559 Propane 1,000 900 800 700 600 500 400 300 200 100 0 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Sharp reduction in LPG price reduced earnings 53
Slide 54: WLPG Production
WLPG Production kt Ave t/TJ 200 1.0 0.9 150 0.8 100 0.7 50 0.6 0 05 0.5 2007 2008 2009 WLPG production (kt) LPG content (t/TJ) Production constrained by Varanus gas disruption 54
Slide 55: Other Businesses
Other Businesses Wesfarmers
Slide 56: Other Business Performance Summary
Other Business Performance Summary Holding Year ended 30 June ($m) 2009 2008 % Share of net profit/(loss) of associates: Gresham Private Equity Funds Various (57) 16 Gresham Partners 50 1 5 W Wespine i 50 4 5 Bunnings Warehouse Property Trust 23 (8) - Sub-total ((60)) 27 Interest revenue 57 34 Divid
Slide 57: Breakdown of Reported Result
Breakdown of Reported Result Year ended 30 June ($m) 2009 2008 Divisional EBIT 3,268 2,321 Other Businesses (190) (4) Corporate overheads (101) (88) G Group EBIT 2 977 2,977 2 229 2,229 Less: Finance costs - expense net of capitalisation 737 692 - other borrowing fees 37 53 - discounts* 53 55 - inte
Slide 58: Gresham Private Equity
Gresham Private Equity • Carrying value of investment in Gresham Private Equity Funds $122m • Australian Pacific Paper Products divested during the period returning 4.5x cash invested • 27% pa Cash IRR from Fund 1 – Riviera only remaining investment; carrying value of nil following receivership • In
Slide 59: For all the latest news visit www.wesfarmers.com.au
For all the latest news visit www.wesfarmers.com.au 59