Wesfarmers Limited · ASX:WES
Wesfarmers — Debt Investor Presentation (August 2022)
23 slides from Wesfarmers's debt investor presentation, Aug 29, 2022
Slide 1: 2022 Full-year results debt investor update
2022 Full-year results debt investor update
Slide 2: Group performance overview
Group performance overview 7 Wesfarmers
Slide 3: 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: Solid financial result reflects strong second half
Solid financial result reflects strong second half Solid full year financial results $36.8b $2.35b $4.2b $2.0b Revenue Net profit after tax cash distributions acquisitions2 and paid to shareholders net capex +8.5% YoY - 2.9% YoY1 $2.3b capital return API, Beaumont Tiles, (+4.9% excl. Health) (+13.1%
Slide 5: Developing platforms to support long-term shareholder returns
Developing platforms to support long-term shareholder returns Investing in our businesses Renewing the portfolio Strengthened e-commerce capabilities and omnichannel offer Development of Mt Holland 1,500+ stores lithium project 100m+ online interactions per month 1 Construction activities underway $
Slide 6: Divisional highlights
Divisional highlights Bunnings Kmart WesCEF Officeworks Group Group • Supported working and learning from home • Remarkable period of • Strong results in 2H22 • Record earnings for the year • Higher costs due to COVID growth, FY19-FY22: following the significant impact • Strong operating impacts and
Slide 7: Focus on long-term value, consistent with our objective
Focus on long-term value, consistent with our objective Climate and Environment Team Community 6.4% $49m >140,000 reduction in Scope 1 and Scope 2 in team member COVID-related support vaccinations delivered at Bunnings sites emissions1 3.3% $54m 140GWh Indigenous employment parity re-gained in direc
Slide 8: Group performance summary
Group performance summary Year ended 30 June ($m) 2022 2021 Var % Revenue 36,838 33,941 8.5 Revenue (excluding Health) 35,598 33,941 4.9 EBIT 3,633 3,717 (2.3) EBIT (after interest on lease liabilities) 3,416 3,491 (2.1) EBIT (after interest on lease liabilities) (excl. significant items)1 3,416 3,5
Slide 9: Divisional sales performance
Divisional sales performance Sales performance ($m) 2021 Year ended 30 June 2022 Retail sales GTV Revenue Total sales +5.2% K+T: (4.0%) +4.6% +1.6% +41.7% +3.8% growth Comp sales +4.8% (1.0%) +8.6% growth 17,739 16,861 6,795 6,832 2,592 2,182 3,014 3,153 3,041 2,146 1,855 1,925 973 989 Bunnings Kmar
Slide 10: Divisional earnings performance
Divisional earnings performance EBT1 Performance and earnings results reflect: FY22 2H22 • Resilience of operating model and strong execution of strategic agenda $2,204m $945m Bunnings Group • Strong commercial growth and solid DIY activity ↑ 0.9% ↑ 3.7% • Investment in long-term growth initiatives
Slide 11: Divisional cash flow and working capital
Divisional cash flow and working capital • Divisional operating cash flows declined 14.2% to $4.1b, Divisional NWC cash movement with divisional cash generation of 78%1 due to: Year end 30 June ($m) 2022 2021 – Retail NWC2 movements due to normalisation in inventory following temporarily low balance
Slide 12: Group cash flow
Group cash flow Group operating cash flow ($b) • Group operating cash flows declined $1.1b or 32.0% to $2.3b, with cash realisation of 59%: – Lower divisional cash flows – Increased tax payments on higher instalment rates • Principal component of lease payments of $1.0b • Net capital expenditure of
Slide 13: Capital expenditure
Capital expenditure • Gross capital expenditure of $1.1b, up 27.7% Year ended 30 June1 ($m) 2022 2021 Var % on prior year Bunnings 349 445 (21.6) – Development capex of $304m and capitalised interest of $34m relating to the Mt Holland mine and concentrator, and at Kwinana refinery Kmart Group 150 18
Slide 14: Group outlook
Group outlook • The Australian economy is starting from a strong base with low unemployment and high levels of household savings, but the effects of inflation and higher living costs are placing pressure on parts of the economy, including household budgets • The Group continues to actively manage in
Slide 15: Balance sheet & debt management
Balance sheet & debt management
Slide 16: Strong balance sheet and credit ratings
Strong balance sheet and credit ratings Key principles Full-year update • Maintaining prudent capital structure and • Repositioned balance sheet to optimise cost strong credit rating is important to of funds and debt maturity profile Wesfarmers – Distributed $2.3b capital return in • Strong credit r
Slide 17: 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 – Repaid €600m (A$866m) seven-year Euro bonds 1,250 750 at 4.7%, which matured in October 2021 250 – New €600m (A$
Slide 18: Debt capital markets diversity
Debt capital markets diversity • Issued €600m (A$938m) in sustainability-linked twelve-year Euro bonds in October 2021 DCM geographical sources3 – The interest rate on the bonds is linked to progress against specific renewable energy1 and emissions2 performance targets (consistent with the domestic
Slide 19: Management of lease portfolio
Management of lease portfolio • Lease liabilities totalled $7.1b and Lease liabilities ($m) FY22 FY21 represented 60% of Group fixed financial Bunnings 3,692 3,738 obligations as at 30 June 2022 Kmart Group 2,642 2,817 • Average remaining committed lease term of Officeworks 345 334 4.41 years (FY21:
Slide 20: Dividends & capital management
Dividends & capital management Key principles Full-year update • Dividend distributions determined based on • Fully-franked final ordinary dividend of franking credit availability, current earnings $1.00 per share and cash flows, future cash flow requirements and targeted credit metrics – Reflects s
Slide 21: Questions
Questions Wesfarmers
Slide 22: 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 23: Wesfarmers
We Wesfarmers
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