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  • Despite coronavirus COVID-19, Wesfarmers (WES) operations are continuing as expected in the first half of the 2020 financial year
  • Strong sales growth has continued in Bunnings, Kmart and Officeworks
  • Across the company, more than 90 per cent of supply factories are now operational and returning to full capacity
  • Whilst there is low availability for certain products due to high demand, Wesfarmers does not currently expect supply chain restrictions to have an impact on trading
  • Given the significant value of uncertainty, the company is unable to provide an estimate on the impact of COVID-19 on its full year results
  • Wesfarmers is down a slight 0.37 per cent and share are trading for $34.76 each

Despite COVID-19, Wesfarmers (WES) operations are continuing in line with the first half of the 2020 financial year.

For the first half of the 2020 financial year the company experienced net profit after tax (NPAT) of $1210 million and revenue of more than $15 million.

Strong sales growth has continued in Bunnings, Kmart and Officeworks, from both online and in-store sales.

In particular, Bunnings and Officeworks have played an important role in providing customers with critical products as they prepare for COVID-19.

This has seen significant demand spike for essential cleaning and hygiene products, home office equipment, technology, and education supplies.

Performance in Wesfarmers’ industrial business has also continued in line with management expectations.

Its industrial and safety businesses are experiencing strong demand for critical products, such as protective clothing, cleaning and hygiene products, and medical gases.

Since January 2020, Wesfarmers’ businesses have been working closely with suppliers and logistics providers to support supply chain operations.

Across the company, more than 90 per cent of supplier factories are now operational and returning to full capacity, while international freight operations are also now performing as usual.

While there is low availability in certain product categories due to high demand, Wesfarmers does not expect supply chain restrictions to have an impact on retail trading performance.

Despite this growth, there has been weakness in sales of non-essential items like apparel.

This weakness is expected to continue and does represent a risk to the outlook for retail sales across the group.

Wesfarmers also expects additional operating costs as it prepares for and respond to COVID-19.

Given the significant value of uncertainty, Wesfarmers is unable to provide an estimate of the impact of COVID-19 on its full year results.

However, its balance sheet remains very strong, given the last month’s sale of its 4.9 per cent stake in Coles for $1.05 billion.

Wesfarmers is down a slight 0.37 per cent and shares are trading for $34.76 each at 2:27 pm AEDT.

WES by the numbers
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