Holmes Institute HA1022: Principles of Financial Management Report

This report provides a detailed analysis of Wesfarmers Limited, an Australian company operating in diverse sectors including retail, resources, and industrial products. The report begins with an industry description, highlighting the growth and significance of the chemical, energy, fertilizer, and industrial safety product sectors in Australia and New Zealand. It then provides a comprehensive overview of Wesfarmers, tracing its history from a cooperative to a major public company, detailing its revenue, employee count, and key acquisitions. The report emphasizes Wesfarmers' significant role in the Australian economy and its restructuring efforts to enhance operational efficiency. Furthermore, it lists the company's subsidiaries and investments, along with the references used for the analysis.

Running head: PRINCIPLE OF FINANCIAL MANAGEMENT
Principle of Financial Management
Name of the Student:
Name of the University:
Authors Note:

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PRINCIPLE OF FINANCIAL MANAGEMENT
Contents
Industry description:........................................................................................................................2
Company description:......................................................................................................................2
References:......................................................................................................................................4

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Industry description:
Headquartered in Perth, Australia, Wesfarmers Limited is an Australian company
operating mainly in Australia and New Zealand in retail, fertilizer, energy, chemical, resources
and industrial safety products. Chemical, energy and fertilizers (CEF) are produced and marketed
by the company. The CEF industry in the country is a booming industry with increasing turnover
being registered year after year in the country. The operations in resources is not limited within
Australia as the company owns resources in different parts of the world and operates
accordingly. Wesfarmers is specifically known for production of metallurgical coal and export of
the same. In addition the company also steams and coal for generation of domestic power in
Australia. Industrial and safety products industry in Australia is an integral part of the gross
domestic products of the country. With each passing year the country is experiencing significant
growth in the industrial and safety products. Wesfarmers is again contributing immensely to the
overall development and growth of the industry. The company provides such products
throughout Australia and New Zealand (Wesfarmers.com.au, 2019).
Company description:
Founded in 1914 as a co-operative, Wesfarmers Limited is one of the largest Australian
companies in terms of revenue. In fact in 2016 the company was the largest company of
Australia with total revenue of $65.98 Billion. In 2016 financial year the company overtook
Woolworths and BHP Billiton Limited in terms of aggregate revenue. The company is an
Australian conglomerate with its head quarter situated in Perth, Western Australia.
Predominantly the company operates in Australia and New Zealand apart from significant
operations in different parts of the world. With more than 220,000 employees Wesfarmers is the

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PRINCIPLE OF FINANCIAL MANAGEMENT
largest private employer in Australia. Thus, not only from the perspective of revenue but also in
regards to employment generation capability in Australia Wesfarmers is clearly the largest
private company in the country (Wesfarmers.com.au, 2019).
At the time of formation of the company back in 1914 as the co-operative society the main
objective of the co-operative was to provide services to the farmers in Western Australia. Within
5 years from its formation more than 65 local cooperatives were providing services to the
Wesfarmers Cooperative as agents. The restructuring of the firm from co-operative society to
public company took place in 1984 and the company listed its shares in the Australian Securities
Exchange on November 15, 1984. With acquisitions of different companies the company started
operating in different industries subsequent to the end of cooperative ownership of the entity in
1984 (Group, 2019).
A crucial restructuring of Wesfarmers Limited took place in August, 2015 when the company
decided to cluster its Chemicals, Energy and Fertilisers, Resources and Industrial and Safety into
a single new industrial division to operate with more efficiency. Apart from its operations in
these industries the company also have invested in 50% shares in Gresham Partners along with
interests Gresham Private Equity. The company also have interests in Wespine and BWP Trusts,
50% and 24% interests respectively. The company has 100% subsidiaries in different parts of
Australia, New Zealand and other countries across globe including India, UK, China and many
others.

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References:
Group, D. (2019). Home. [online] Wesfarmers.com.au. Available at:
https://www.wesfarmers.com.au/ [Accessed 15 May 2019].
Wesfarmers.com.au. (2019). [online] Available at: https://www.wesfarmers.com.au/docs/default-
source/default-document-library/2017-annual-report.pdf?sfvrsn=0 [Accessed 15 May 2019].
Wesfarmers.com.au. (2019). [online] Available at: https://www.wesfarmers.com.au/docs/default-
source/reports/2016-annual-report.pdf?sfvrsn=8 [Accessed 15 May 2019].