By Mike Cherney
SYDNEY--Australian conglomerate Wesfarmers boosted its dividend after fiscal first half profit rose, driven by strong performances in key retail divisions and its chemicals, energy and fertilizers business.
Wesfarmers said net profit in the six months through December was 1.60 billion Australian dollars (US$1.13 billion), a rise of 9.3%. Revenue rose 3.1% to A$24.2 billion.
The company declared an interim dividend of A$1.02/share, compared to A$0.95/share in the prior corresponding period.
Wesfarmers said the Bunnings hardware chain posted earnings growth of 5%, the Kmart discount department store chain grew about 6% and its chemicals, energy and fertilizers unit had earnings grow about 18%, which it said was largely due to a positive contribution from its lithium business.
Looking ahead, Wesfarmers said its retail divisions continued to trade well in the first six weeks of the fiscal second half. Bunnings and office chain Officeworks sales growth were both broadly in line with the first half, and Kmart's was stronger.
Wesfarmers warned that although consumer demand remains solid, cost-of-living pressures are being felt unevenly across the economy and impacting many households.
Some analysts were relatively upbeat heading into the result. Jefferies analysts Michael Simotas and Naveed Fazal Bawa said that Bunnings sales were likely to be solid, and they noted that momentum seemed to improve further through November after management noted in October that sales were trending higher than the previous half. Their channel checks showed Kmart also seemed to have a solid November and December.
Though Wesfarmers' lithium joint venture Covalent was still expected to lose money in the fiscal first half, a rise in lithium prices has "materially lifted the outlook for earnings," the Jefferies analysts said.
Write to Mike Cherney at mike.cherney@wsj.com
(END) Dow Jones Newswires
02-18-26 1648ET
