WES +1.33% : A solid result today from Wesfarmers with revenue up 27% Y/Y to $22.6bn which was above consensus of $20.5bn, driving a ~9% beat to earnings before tax (EBT) while they declared a 1H23 dividend of 88cps. The result was driven by Kmart as consumers traded down, while their Chemical, Energy & Fertilizer business was also strong. Bunnings produced $1.3bn EBT – up 1.5% and inline with expectations while Catch & Office Works were light on. They said retail trade for the 1st 5wks was broadly in-line with 1H23 growth, which is a good outcome. No guidance was provided which is customary for WES, however, the market is expecting FY23 revenue of $40.42bn and FY EBT of $3.76bn. Given they produced $2.1bn in 1H23, there is some slight deterioration already priced in by the market.
We have turned more positive WES following this result and will hold our position in the Income Portfolio
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