WES - Wesfarmers Limited

[Dona Ferentes]

I am told QAN have no cash.

WES were cashed up to the nines even before this bug hit. Selling down more COL is icing on cake.

IF WES directors get the nod from the Feds they will be in like Flynn imo.

Can't see it. Somehow the WES process, with strict Rates of Return parameters. Rob Scott, new honcho, seems more focused on emerging industries. IT and software solutions for supply chains (Catch, Bunnings on-line) or efficiencies (Kidman Transaction Rationale
• Global uptake of electric vehicles presents an attractive opportunity
• Investment in a globally significant, high-grade lithium project
• Opportunity to leverage Wesfarmers’ expertise & capabilities in chemical processing
• Partnership with an industry leader)Of course the company missed out on Lynas

Reflecting on WES 'style', from april 2019

But any conglomerate that is selling assets also needs to be developing its own or buying. And with more than $10 billion at its disposal, Scott had Wesfarmers' large corporate development team hunting for opportunities. Scott, a former investment banker, previously ran Wesfarmers' industrials, insurance and financial services businesses, and worked in its in-house dealmaking unit, corporate development. He had told investment bankers he respected the company's conglomerate roots and had every intention of keeping it going.

He also had some well-regarded former private equity dealmakers to help reshape and restock the portfolio, including former KKR Australia executive Ed Bostock as head of business development, ex-Virgin Group co-CEO and Goldman Sachs alumnus David Baxby as industrials boss, and former Catalyst Investment Managers operative Aaron Hood.

So bankers stepped up pitching to Wesfarmers' Scott and his wider team. Bankers say they were never given guidance on Wesfarmers' preferred investment size or sector, but knew Scott was keen on a portfolio-style approach that promised a handful of deals over a few years rather than one big bet like Coles. There are stories about all sorts of ideas being pitched – some given more thought than others.

https://www.afr.com/companies/manuf...ott-and-his-m-and-a-war-chest-20190331-p519aa

 

[Garpal Gumnut]

Can't see it. Somehow the WES process, with strict Rates of Return parameters. Rob Scott, new honcho, seems more focused on emerging industries. IT and software solutions for supply chains (Catch, Bunnings on-line) or efficiencies (Kidman Transaction Rationale
• Global uptake of electric vehicles presents an attractive opportunity
• Investment in a globally significant, high-grade lithium project
• Opportunity to leverage Wesfarmers’ expertise & capabilities in chemical processing
• Partnership with an industry leader)Of course the company missed out on Lynas

Reflecting on WES 'style', from april 2019https://www.afr.com/companies/manuf...ott-and-his-m-and-a-war-chest-20190331-p519aa

Good points, O Greek one.

May not occur now when everyone is watching.

May occur when ROI is a given. At the bottom.

One or two trojan horses from WES in QAN as we speak.

gg

 

[Dona Ferentes]

One or two trojan horses from WES in QAN as we speak.

gg

like an ex-Virgin Group co-CEO ?!?!?! (as mentioned in AFR article <from April Fools Day 2019>)

 

[galumay]

What they should do is pay down some of the debt with the cash, but that sort of responsible capital allocation is unlikely.

 

[Garpal Gumnut]

like an ex-Virgin Group co-CEO ?!?!?! (as mentioned in AFR article <from April Fools Day 2019>)

In times of war, plague and famine we make unlikely friends.

gg

 

[CBerg]

Didn't these guys overpay badly for Coles in the first place? What's to say the cash burning a hole in their pockets is going to be used wisely this time?

 

[Dona Ferentes]

Wesfarmers is sitting on more than $2bn in cash following the partial sell down of its stake in Coles; speaking at a Macquarie conference, CEO Rob Scott said it would look to invest in online.

“In terms of online investment we will very much be led by the divisions, and by the customer I guess, in how much we spend and how quickly we spend, we are seeing some great opportunities to invest in the digital space. “Interestingly, because a lot of software is cloud-based solutions, the upfront costs associated with a number of these are materially lower than they were five to 10 years ago. So a lot of the investment we are making is more opex (operational) than capex (capital) and you can get quite a lot of bang for your buck in terms of the investment you make.”

Mr Scott said he expected more significant online investments to be made in its Bunnings, Kmart and Catch businesses, where "the online marketplace was already finding capacity constraints at its distribution centres. "

but no mention of Target !!

 

[Garpal Gumnut]

Wesfarmers is sitting on more than $2bn in cash following the partial sell down of its stake in Coles; speaking at a Macquarie conference, CEO Rob Scott said it would look to invest in online. but no mention of Target !!

Target has been factored in to the accounts as far as I know, or will be.

The Cloud investing opportunity was not one I was aware of.

gg

 

[Dona Ferentes]

Target has been factored in to the accounts as far as I know, or will be.

The Cloud investing opportunity was not one I was aware of.

gg

Wesfarmers was also learning new digital skills from its recent acquisition of Catch.

“We have seen very strong growth in sales in the Catch marketplace and we have also learnt a lot about the digital experience within the Catch business that we have been able to roll out in some of our other businesses,’’ Rob Scott said.

 

[Garpal Gumnut]

I do wish WES would retrace to $40 or break up through $50 so that I can add to my holdings.

Where are Pete Evans, Qanon, assorted Witches and Sovereign Citizens to disrupt the sausage sizzle at Bunnings when one needs them.

In the old days cooks, jesters and wizards were traded as chattels between people of worth. Now they are spoken to nicely by the constabulary.

A chart at 12.51 pm .

gg

 

[sptrawler]

Looks as though Wes is getting some software smarts into the team, sounds like a good move to me.

https://www.wesfarmers.com.au/docs/default-source/asx-announcements/director-appointment7b796b6999c863f7bfccff00000e9025.pdf?sfvrsn=1db108bb_0

I do hold

 

[Dona Ferentes]

I do wish WES would retrace to $40 or break up through $50 so that I can add to my holdings.
gg

Sizzling ... now $51 a share

 

[Garpal Gumnut]

Well 2021 beckons and I for one am looking forward to it. WES is one of the cornerstones of my SMSF.

It's a value company all cashed up and the long term trend is up.

I'm trusting it cracks $100 before this time next year.

gg

 

[Dona Ferentes]

It's a value company all cashed up and the long term trend is up.

I'm trusting it cracks $100 before this time next year.

and heading in the right direction, going in to reporting season. WES has been remarkably quiet on the deployment of the war chest from selling down Coles . (Incidentally COL + WES is well over $70; WOW doing well too)

Maybe the price action is for the rerating as a Lithium company?

Three year chart

(HOLD, both SMSF and own name)

 

[sptrawler]

It will be interesting to see if they have a target, for all their cash.

I do hold.

 

[Dona Ferentes]

I never knew geeks2U was a WES company , aligned through Officeworks

 

[Dona Ferentes]

Wesfarmers Limited (ASX: WES) today announced the joint approval, together with Sociedad Quimica y Minera de Chile S.A. (SQM), of the final investment decision for the Mt Holland lithium project, and committed initial funding. Full funding will be committed upon receiving environmental approvals for the Kwinana refinery, which are anticipated in early FY2022.


(WES reports tomorrow; Hold)

 

[bk1]

I don't blame them for taking their time, thats a lot of money..
Wesfarmers share of capital expenditure for the development of the project is estimated at approximately $950 million.

 

[sptrawler]

Wesfarmers Limited (ASX: WES) today announced the joint approval, together with Sociedad Quimica y Minera de Chile S.A. (SQM), of the final investment decision for the Mt Holland lithium project, and committed initial funding. Full funding will be committed upon receiving environmental approvals for the Kwinana refinery, which are anticipated in early FY2022.


(WES reports tomorrow; Hold)

The refinery is interesting, there already is a lithium hydroxide refinery 90% complete at Kwinana.
Is Wes talking of a second refinery? If so that really will give the Kwinana industrial strip a shot in the arm.

 

[Dona Ferentes]

The refinery is interesting, there already is a lithium hydroxide refinery 90% complete at Kwinana.
Is Wes talking of a second refinery? If so that really will give the Kwinana industrial strip a shot in the arm.

it would appear so. .... from 2019

At its peak, the [Tianqi] refinery will spit out 100,000 tonnes of Lithium Hydroxide (LiOH) each year, which translate to more than a third of the world’s demand for the metal. Another refinery planned close by in Kwinana will be producing nearly half the production of this plant.

from https://www.covalentlithium.com/refinery .. (being the 50:50 WES/ SQM JV) ... and 2021

... our objective is to produce approximately 45,000 tonnes of lithium hydroxide per year, once our plant has been completed