Wesfarmers FY26 NPAT $2,874m, Ordinary Dividend Up 7.8%

Wesfarmers Limited (ASX:WES) reported statutory net profit after tax of $2,874 million for the year ended 30 June 2026, down 1.8 per cent on FY25. There were no significant items in FY26; excluding FY25 significant items of $279 million pre-tax ($273 million post-tax), net profit after tax increased 8.3 per cent. Revenue rose 3.4 per cent to $47,274 million and earnings before interest and tax were $4,493 million, up 0.6 per cent on a statutory basis and up 7.3 per cent excluding the prior-period significant items. Operating cash flows fell 6.5 per cent to $4,272 million, which managing director Rob Scott attributed to deliberate investments in working capital at WesCEF and Health: higher spodumene inventories and investment in additional fertiliser inventory at elevated prices as a result of supply disruptions from the Middle East conflict, and increased inventory contingency in Health to protect against supply chain disruption from the same conflict. The group cash realisation ratio excluding significant items was 91 per cent, while Mr Scott said cash realisation across the retail divisions was 99 per cent. Net financial debt rose 25.1 per cent to $5,295 million and debt to EBITDA excluding significant items was 1.9 times against 1.7 times. The board determined a fully franked final dividend of $1.20 per share, taking total fully franked ordinary dividends for the year to $2.22 per share, up 7.8 per cent; separately, a capital management distribution of $1.50 per share, comprising a capital return of $1.10 and a fully franked special dividend of $0.40 and totalling $1,703 million, was paid in December 2025.

By division, on the earnings measure used in the release's performance summary, which is struck after interest on lease liabilities, Bunnings Group earnings rose 5.1 per cent to $2,455 million on revenue up 4.1 per cent to $20,399 million, with total store sales up 4.0 per cent and store-on-store sales up 3.7 per cent. Kmart Group earnings increased 6.0 per cent to $1,109 million and WesCEF earnings rose 18.5 per cent to $473 million. Officeworks earnings fell 22.2 per cent to $165 million, which the company said was largely due to one-off transformation costs, put at approximately $40 million and mainly reflecting restructuring activities to reset the cost base and ERP related costs, with earnings also affected by strategic clearance activity to support the introduction of new and expanded ranges. Wesfarmers Health earnings increased 18.8 per cent to $76 million. Industrial and Safety earnings fell 26.9 per cent to $76 million as reported; excluding the contribution from Coregas, whose sale completed on 1 July 2025, the release states earnings increased 16.9 per cent, or 2.7 per cent after adjusting for restructuring costs incurred in the prior year. The Industrial and Safety businesses transitioned to Bunnings Group effective 1 July 2026. The release states WesCEF's share of spodumene concentrate production was 209kt, above both guidance and nameplate capacity of 190kt, and that ramp-up of the refinery was affected by intermittent odour issues throughout the year, with installation of mitigation measures commencing late in FY26. For FY27 Wesfarmers expects net capital expenditure of between $1,300 million and $1,500 million, subject to net property investment and the timing of project expenditures, including approximately $200 million relating to the expansion of the Mt Holland mine and concentrator, and expects borrowing costs to be higher. Spodumene concentrate production at Mt Holland is expected to be in line with nameplate capacity of approximately 380kt, a WesCEF share of approximately 190kt, with around half of that production to be sold to market. In the first seven weeks of FY27 Bunnings' sales growth was slightly stronger than the 3.9 per cent recorded in the second half of FY26, which the company said was assisted by unseasonably dry weather in July, while Kmart Group's growth was in line with its 2.2 per cent and Officeworks' was slightly below its 2.7 per cent.