Insights 27th August 2021
Wesfarmers to return $2.3b to shareholders | Wesfarmers (ASX:WES) Reporting Season Results
Wesfarmers (ASX:WES) reported its 2021 financial year results, here’s what you need to know.
Wesfarmers reported a statutory net profit after tax (NPAT) of $2.380 billion for the full-year ending 30 June 2021, up 40.2% compared to the prior period. This comes in ahead of Bell Potter’s expectation of $2.333 billion but is in line with consensus of $2.381 billion.
While COVID-19 had a significant impact on operations during the year, the Group continued to invest in providing greater value, quality and convenience for its customers. Bunnings, Kmart, Catch and Officeworks all delivered strong sales and earnings growth for the year.
Also, given customers were spending more time working, learning and relaxing at home, due to travel restrictions, strong demand supported various product categories.
The Group recorded operating cash flow for the year at $3.383 billion, which is 25.6% lower than the prior year.
Wesfarmers have declared to pay a fully-franked final ordinary dividend of 90 cents per share reflecting the strong NPAT result. The final dividend brings total fully-franked ordinary dividends for the full year to $1.78 per share.
As well as the final ordinary dividend, the directors are recommending a return of capital of $2.00 per share. This represents a $2.268 billion distribution. This however is subject to shareholder approval at its AGM on the 21 October 2021. This distribution will enable a more efficient capital structure while maintaining balance sheet capacity.
WES shares are currently trading down 3% today after the release of its results, however remain about 23% up YTD, and most brokers have Wesfarmers as a HOLD except Citi has Wesfarmers as a SELL and Macquarie has Wesfarmers as a BUY.