Wesfarmers shares rise after strong results

The news: Conglomerate Wesfarmers has lifted its annual profit and dividend, bolstered by stronger earnings from Kmart, Officeworks and its industrial business.

The numbers: Net profit for the year to 30 June was up 4.8% to $2.5 billion, while revenue rose 18.2% to $43.6 billion, boosted by the recent takeover of Australian Pharmaceutical Industries. Earnings at Kmart Group jumped 52.3%, while Officeworks saw gains of 10.5% and industrial and safety arm WesCEF lifted earnings 23.9%.The company will pay a final dividend of $1.03 a share, up from $1 a year ago.

The context: Hardware chain Bunnings, which remains the key contributor to Wesfarmers profitability, saw earnings edge up 1.2% as consumers slowed down spending. The company said retail customers have increasingly sought out value and traded down to lower priced items within product ranges through the year. It expects cost pressures to remain elevated, driven by wage cost increases and domestic supply chain costs.