Wesfarmers Limited (WF3) Q4 2026 Earnings Report

Overall the call conveyed solid operational and financial momentum: group profit and divisional earnings grew, free cash flow rose materially and strategic initiatives (marketplace, retail media, lithium expansion, health and new store formats) are progressing. Management acknowledged near‑term headwinds — Officeworks transformation costs, working capital investments, rising finance costs, raw‑material inflation and lithium refinery execution risks — but presented these as largely manageable within a resilient portfolio and disciplined capital allocation approach. On balance the positive financial outcomes, portfolio progress and strong cash generation outweigh the challenges called out.

Wesfarmers guided that FY26 delivered NPAT of $2.9bn (up 8.3% excluding prior significant items) and a fully‑franked final dividend of $1.20 (total $2.22/sh, +7.8%); divisional earnings rose 6.2% with Bunnings sales +3.9% and EBIT ex‑property $2.45bn (+5%), Kmart Group EBIT $1.1bn (+6%), WesCEF EBIT $473m (+18.5%, lithium profit $40m), Officeworks sales +3.7% with EBIT $165m (‑22.2%, ~$40m one‑offs), Health EBIT $92m (+12.2%) and Industrial & Safety ex‑Coregas EBIT $76m (+16.9%); group TRIFR improved to 9.1 (WesCEF 0.6), 4% of Australian team identify as Aboriginal/Torres Strait Islander, Scope 1&2 market‑based emissions fell >20% and retail divisions hit 100% renewable electricity in CY2025; marketplaces/retail media are scaling (Bunnings+Kmart marketplace GMV now >$250m, Bunnings marketplace +25%, combined marketplace growth ~70% YoY), operating cash flow was down 6.5% while free cash flow rose to $4.0bn (+15.8%), cash realization 99%; gross CapEx $1.2bn (+4.1%), net CapEx $779m (‑29%) with FY27 net CapEx guidance $1.3–$1.5bn (including ~ $200m for Mt Holland), net financial debt $5.3bn (debt/EBITDA 1.9x from 1.7x), finance costs $202m (+8%) and higher borrowing costs expected in FY27, committed unused facilities ~ $1.7bn, associates/JV profit $106m (+$42m), $73m invested in OneDigital/AI/retail media, and management expects FY27 earnings growth (aspiring to grow earnings ahead of sales) but flagged FY27 operating‑leverage will be partly offset by one‑off dual‑running commissioning costs.