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  • Conglomerate giant Wesfarmers Kmart Group holdings recorded a 13.7 per cent drop in EBIT during the 2019 financial year
  • The company’s profits after tax is up, although significantly lower than it would have been after de-merging with Coles
  • Wesfarmers’ share price is up 0.83 per cent today, amending a near three per cent dip this morning – it currently sits at $39.01 apiece, as of AEST 1:06 pm

Wesfarmers is battling a sinking share price after shareholders negatively responded to its yearly earnings.

The conglomerate giant detailed earnings before interest and tax (EBIT) are down 13.7 per cent in the Kmart Group holdings. This features the namesake retailer, as well as household name Target and online merchant Catch of the Day.

However, profits after tax are up 13.5 per cent at $1.94 billion for the 2019 financial year. Although, profits including Wesfarmers’ discontinued operations totalled $5.51 billion.

Over the financial year, Wesfarmers de-merged from Coles and sold off its interests in Bengalla, Kmart Tyre Auto Service and Quadrant Energy. The company also sold its Bunnings operations in the U.K. and Ireland, a transaction which lost it $375 million.

In Australia and New Zealand, Bunnings is the company’s top performer, accounting for 57 per cent of earnings before interest and tax. The branch’s revenue increased five per cent on the previous year, and individual EBIT is up 8.1 per cent.

Wesfarmers’ industrials businesses are the third biggest earners for the company, one per cent lower than Kmart Group’s contribution. Overall, the sector saw growth in revenue and EBIT, except in the industrial safety zone, which was down 27.1 per cent due to Blackwoods’ poor performance.

Due to improvements in online services and expanding ranges, Officeworks’ revenue and EBIT increased during the financial year. Although, Wesfarmers advises earnings growth throughout the 2020 financial year may be effected by increasing team member wages.

Shareholders will receive a final dividend of $0.78 per share, brining the total for the year to $2.78.

Wesfarmer’s shares are up 0.83 per cent as of AEST 1:06 pm, recovering from a near three per cent dip this morning. Currently share’s in the conglomerate giant are worth $39.01 apiece.

WES by the numbers
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