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WES - Wesfarmers Limited

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sptrawler said:
Yes the GFC was the biggest over reaction con job I've ever seen, WES was a magic pickup then, so was CSL $27 and MQG $15.
Nothing like a crisis, to tighten sphincters and release value. ?
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I don't know about con job but it was good to see what fell out when the tree was shaken. Fresh Fruit for Rotting Vegetables.
 
  • For FY 2022 its net profit slipped 1.2 per cent to $2.35 billion
  • Sales up 8.5 per cent to $36.84 billion.
  • Net debt stood at $4.3 billion.
  • NPAT growth of 13.1 per cent excluding significant items
  • Dividend of $1.00 ff; full-year dividends up 1.1 per cent to $1.80 per share,

Flagship Bunnings’ revenue was up 5.2 per cent to $17.75 billion over the year with earnings up 0.9 per cent to $2.2 billion.
Kmart Group sales fell by 3.5 per cent to $9.635 billion for 2022 FY. Earnings of $418 million were 39.7 per cent lower. COVID-related disruptions saw almost 25 per cent of store trading lost, in the first half.
Sales at Officeworks were in line with the prior year: revenue increased 4.6 per cent for the year to $3,169 million, while earnings of $181 million were 14.6 per cent lower
Wesfarmers Chemicals, Energy & Fertilisers (WesCEF) posted record earnings reflecting elevated global commodity prices.


The group didn’t provide any specific financial guidance for FY 2023.
 
Boggo said:
Nothing recent. I do remember when they got Mt Holland from Kidman Resources a few years ago but they don't seem to get a mention with the popular producers or those close to producing.
Usual updates on those with potential
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I have a feeling that there is a lot of potential there, vertical integration is a strategy currently only being approached by China. WES is the only non Chinese company I know of working towards it.
 
These things are known:
Heightened tensions between China and the US over the past few years have prompted the US to encourage its manufacturers to reduce their reliance on China for a range of critical minerals.

This is playing into the hands of Wesfarmers as it proceeds with its $1.7 billion investment in the Mt Holland lithium project, which is a 50 per cent joint venture with Chilean-based lithium producer, Sociedad Quimica y Minera (SQM).

Mt Holland, which is believed to be the largest advanced manufacturing project underway in Australia, will provide the world’s car manufacturers with an alternative to Chinese made lithium hydroxide (China refines 60 per cent of the world’s lithium ore).

Wesfarmers spent $304 million of its promised $950 million capital investment in the Mt Holland project in 2022 and CEO Rob Scott says it will be producing lithium hydroxide by the end of 2024. The project includes a lithium mine, a concentrator and a refinery at Kwinana.

He says the chemical processing plant will take six to 12 months to reach its production capacity of 50,000 tonnes a year. At current prices, that output would be worth $US3.75 billion in revenue.

But most analysts believe the lithium hydroxide price will fall from its current level of $US70,000 a tonne to a much lower level by 2024. Macquarie forecasts the price will be $US33,750 a tonne in 2024 and Barrenjoey says it will be $US31,000 a tonne.
..............
And this comment is new:

Scott says Wesfarmers is seeing strong interest in its proposed supply of lithium hydroxide from customers trying to cut their reliance on Chinese supply.

“Most of the customers we are speaking to are ex-China,” he says. “A lot of the European, American and North Asian car manufacturers and battery manufacturers have a strong preference for sourcing lithium hydroxide outside of China.
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and more
Mt Holland lithium project is progressing well, chief executive Rob Scott said during the briefing.
  • Development of the project’s village and aerodrome are complete
  • Construction of the concentrator and refinery is advancing.

Wesfarmers’ lithium team has also progressed discussions with key customers, that “continue to be supported by very strong market fundamentals”, Scott said.

The company’s net capex was largely driven by $304 million of project capex and $34 million of capitalised interest in relation to the Mt Holland lithium project, chief financial officer Anthony Gianotti said
 
The first in-depth interview by Emily Amos, some 5 months into the appointment as head of the new Health and Wellbeing division at WES.

Amos is looking to prioritise digital and data investment. This may include developing new and innovative products and services within the business including digital health initiatives. Other targets could include rivals such as Sigma Healthcare, and eventually private hospitals and beauty businesses.

API’s Sister Club, which boasts over 7.5 million members and is the fourth-largest loyalty program in Australia in terms of market penetration, represents the biggest opportunity. Amos plans to use this data to jumpstart sales, help expand ranges, and improve pricing and promotions.

Over the past financial year, Priceline was supported by strong sales in all major health categories due to the large numbers of cold, flu and COVID-19 cases that came with people returning to more normal patterns of working, travelling and socialising as lockdowns ended.

This was partially offset by weakness in beauty, as people cocooned at home amid the pandemic. Amos says beauty is pivotal to Priceline – which plays in the affordably priced market where many teenagers experiment with make-up.

.... Priceline is being savaged by Chemist Warehouse. Although there's money in cosmetics for everyone. A friend's daughter went to have a bit of 'work', spending her saved $200, nip here, hold a line there, and was asked if she was grinding her teeth at night? $800 later. Ah, botox. Ah vanity. Ah, fries with that.
 
AGM today

Some customers are becoming more price sensitive as they try to manage squeezed household budgets and rising energy costs.
Australian consumer demand continued to be supported by low unemployment and high levels of accumulated household savings, but rising interest rates and the impact of inflation were starting to affect consumer behaviour.
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  • Wesfarmers was well-placed to meet shoppers’ needs as they looked for value, and the combined sales growth for Kmart and Target in the year-to-date was strong, even when adjusting for the impact of lockdowns a year ago.
  • Bunnings sales in recent months had been hurt by the wet weather, but overall sales growth for the year-to-date remained resilient and supported by strong demand from commercial customers. DIY sales growth was positive, but moderated from the high levels experienced through COVID
  • Officeworks’ sales for the year-to-date remain broadly in line with the prior year,
  • Industrial and safety division has continued to improve, with sales growth recorded across all business units through the year-to-date.
  • Sales at Catch marketplace have declined so far this year following a surge in pandemic-led spending a year ago.
  • CEO Rob Scott called the 2023 year “foundational” for the OneDigital division as the vertical invests in systems and capabilities to support its data and digital ambitions. Wesfarmers expects OneDigital to post an operating loss of $100 million for the financial year, excluding Catch.
  • Chemicals, energy and fertilisers division had continued to benefit from strong customer demand and elevated commodity prices
  • Development of the Mount Holland lithium project was progressing well. In about two years, Wesfarmers will be selling lithium hydroxide, refined at Kwinana in Western Australia, to support the accelerating global uptake of electric vehicles.
 
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WES really needs to change the name of their online outfit.

Catch.

It is bloody awful and some nitwit probably got $100,000 for thinking it up.

gg
 
Garpal Gumnut said:
WES really needs to change the name of their online outfit.

Catch.

It is bloody awful and some nitwit probably got $100,000 for thinking it up.

gg
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not more more spent on advertising ....

got to keep the name short , less and less folks can spell or read

maybe just a big animated hook ( 'cos Wesfarmers got caught )

i hold WES

i note no particular news on the fate of Office-Works , i hope they don't try off-load it mid-depression
 
I've backed WES in the 2023 comp.

A solid company.

It should be $100 by years end as long as the move of it's corporate HQ to Melbourne does not contaminate the work ethic of those at the top.

gg
 
Dona Ferentes said:
As we move towards reporting season*, this underappreciated lithium story is back over $50, for the first time in a while.

*Wednesday 15 Feb for WES
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Thanks @Dona Ferentes

Some don't realise the many pies in which WES has it's fingers

It is a conglomerate in the true meaning of the word.

I'm guessing it will double in price by years end.

JOHN DORY

gg
 
Garpal Gumnut said:
Thanks @Dona Ferentes

Some don't realise the many pies in which WES has it's fingers

It is a conglomerate in the true meaning of the word.

I'm guessing it will double in price by years end.

JOHN DORY

gg
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Dissect the global stock universe by ROE, leverage, earnings vol and compose a portfolio from the best of that dissection, or just buy WES

 
Dona Ferentes said:
As we move towards reporting season*, this underappreciated lithium story is back over $50, for the first time in a while..
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This is behind a paywall, but there's probably enough info (information, but this is a blog) included to ring true. We shall wait until the half yearly report and associated updates:

Herd on the Terrace: Wesfarmers prepping to charge into more critical minerals after Kidman Resources win​

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- The West Australian
 
Dona Ferentes said:
This is behind a paywall, but there's probably enough info (information, but this is a blog) included to ring true. We shall wait until the half yearly report and associated updates:


- The West Australian
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Thanks for the behind paywall info.

As you say @Dona Ferentes WES is in to critical metals and many punters are unaware of this aspect of the conglomerate.

The half yearly report will be interesting.

gg
 
Garpal Gumnut said:
Thanks for the behind paywall info.

As you say @Dona Ferentes WES is in to critical metals and many punters are unaware of this aspect of the conglomerate.

The half yearly report will be interesting.

gg
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i am still skeptical on the importance of lithium in the future , however my holding in WES and MIN have provided lithium exposure without extra cash investment ,

i will be interested in the WES half yearly , but will probably more focused in other areas ( work-wear , fertilizer and Office-Works )

cheers
 
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