Sydney, June 11, 2026, 02:12 AEST
Wesfarmers Ltd. shares climbed 4.25% to A$83.39 on Wednesday. The Bunnings and Kmart parent talked up profit growth prospects tied to artificial intelligence, digitisation, and a bigger addressable market for Bunnings at its 2026 strategy update. That jump outpaced the S&P/ASX 200, which rose 0.57% to 8,653.30.
No change in earnings from the last session, but management told investors more about where they see possible sales growth and savings if shoppers keep watching prices. They pointed to productivity, upgraded inventory data, automated supply chains and using AI in sales. Wesfarmers put up its Strategy Briefing Day slides and webcast on June 10 at its investor centre.
Wesfarmers’ last earnings kept traders watching for weaker momentum. In February, Reuters said shares fell, even though Wesfarmers beat expectations on its first-half profit. Sales in the second half missed estimates, and management said cost pressures remained tough for households.
Wesfarmers put Bunnings front and centre in its pitch Wednesday, betting the hardware chain has a shot at a A$113.5 billion addressable market. By “addressable market,” Wesfarmers meant the full revenue it thinks Bunnings could chase over time, going beyond hardware into categories like pets, cleaning, home security, auto parts and workwear. The Australian
Blackwoods and Workwear Group are moving into Bunnings Group, Wesfarmers said on June 2. That transfer—set for July 1—covers the company’s Industrial and Safety businesses. They’ll keep running as their own brands. Wesfarmers said this will build scale, make customer offers stronger and drive some cost efficiencies, but doesn’t expect any material one-off costs tied to the move.
Wesfarmers’ message on tech got some attention in the strategy update. The company pointed to RFID for tracking inventory at Kmart and Target, and said electronic shelf labels are in place at Bunnings. Demand planning tech is now at Bunnings, Kmart Group and Officeworks. Robotics is live at WesCEF, its chemicals, energy and fertilisers arm. Management also said they are using AI in areas like merchandising, marketing, supply chain planning and contact centres.
Whether those tools can boost margins while keeping Bunnings and Kmart’s low-price image is the question for investors. Agentic AI, described as tech that helps finish tasks instead of just answering questions, was pitched as a way to steer shoppers, lift conversion and help staff. That’s the potential upside. But the company still has to show it in actual sales and costs.
Kmart puts growth back in focus for Wesfarmers. The company highlighted plans for Anko’s international push in its latest presentation, noting there are already five stores running in the Philippines and more coming by the end of FY27. Kmart is pairing its low-cost focus with global sourcing, fresh product work and more digital.
Officeworks still looks like a repair job. At the strategy briefing, management set out a plan for a multi-year overhaul focused on cutting costs, updating its product lines, improving online and in-store sales, and going harder after business, tech, and education customers. This comes after Officeworks delivered weaker profits for Wesfarmers in the first half.
WesCEF is still in the forward view. Wesfarmers’ strategy materials said the Covalent Lithium project hit first production of high-quality lithium hydroxide in FY26 and the focus now is on ramping up the refinery and customer checks. Lithium is still key as it lifted the group’s first-half profit, but it carries commodity-price risk and execution risk.
Wesfarmers said first-half revenue rose 3.1% to A$24.2 billion and net profit after tax was up 9.3% at A$1.6 billion for the six months to Dec. 31. The company lifted its interim fully franked dividend 7.4% to A$1.02 per share. Bunnings, Kmart Group and WesCEF made up the bulk of earnings. Net profit after tax is what is left for shareholders after expenses and tax.
Wesfarmers shares jumped Wednesday, but the rally may be pricing in smoother execution than the company can actually achieve. Management talks about a bigger market, but that doesn’t mean revenue follows, and AI cost cuts aren’t instant. Reinvesting in prices could hurt margins, especially if shoppers keep holding back. Back in February, reported Wesfarmers had already flagged patchy household spending and said lower-income shoppers were struggling more with inflation.
Test comes soon. Blackwoods and Workwear Group will come under Bunnings from July 1, with Wesfarmers saying their results will be part of Bunnings’ first-half FY27 numbers. Key Bunnings sales measures will still be reported without those additions. Management plans more detail with full-year results in August. Investors will be watching then to see if the optimism from strategy day is showing up in sales, productivity, and a better lithium ramp.
