4 key takeaways from the Wesfarmers (ASX:WES) strategy briefing

Wesfarmers has been updating the market on a few things on Thursday…
The post 4 key takeaways from the Wesfarmers (ASX:WES) strategy briefing appeared first on The Motley Fool Australia. –

The Wesfarmers Ltd (ASX: WES) share price is trading broadly flat at $56.25 on Thursday following the release of its strategy briefing.

Listed below are a few key takeaways from the strategy briefing:

Wesfarmers’ retail businesses growing on a two-year basis

The company notes that its retail businesses have been cycling the impacts of COVID-19 in the prior year from mid-March. This has led to significant volatility in monthly sales growth results. However, on a two-year basis, all of Wesfarmers’ retail businesses have continued to record strong sales growth. Management believes this reflects their ability to provide safe and trusted environments while delivering greater value, quality and convenience for customers.

Online sales growth is moderating

As we have seen with ecommerce company Ltd (ASX: KGN), Wesfarmers has experienced a moderation in its online sales growth after customer traffic to stores increased. This has resulted in a reduction in online penetration. It has also led to the Catch business’ gross transaction value growth being negative since mid-March. However, management notes that overall online penetration remains above pre-COVID levels.

Industrials businesses performing positively

Wesfarmers isn’t just Bunnings, Kmart, Catch, Officeworks, and Target, it also has a range of industrials businesses. These include Covalent Lithium, QNP, and CSBP. Pleasingly, the company revealed that positive trading has continued in the industrials segment and good operating performances have been achieved.

Kmart well-positioned

Management spoke positively about its Kmart business and believes it is well-positioned for sustainable long term growth. It continues to drive the growth of Kmart by leveraging scale and product development capabilities, completing the store conversion program and delivering digital initiatives. Another positive is that Kmart Group now expects to incur pre-tax, one-off non-operating costs of approximately $60 million to $70 million in FY 2021 relating to Target store closures and conversions. This is a reduction from its previous estimate of $90 million to $110 million.

The post 4 key takeaways from the Wesfarmers (ASX:WES) strategy briefing appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!