The Wesfarmers Ltd (ASX: WES) share price suffered last month, slipping 8.58% lower.
At the end of February, the Wesfarmers share price was $48.19. For comparison, it ended January trading at $52.71 apiece.
It wasn’t such a challenging period for the broader market. The S&P/ASX 200 Index (ASX: XJO) gained 1.1% over February, while the All Ordinaries Index (ASX: XAO) ended it 0.7% higher.
Let’s take a look at what put pressure on the ASX blue chip last month.
What weighed on the Wesfarmers share price last month?
The major catalyst for the Wesfarmers share price last month was the release of the conglomerate’s half-year results.
The first six months of financial year 2022 saw the company’s retail brands suffer through COVID-induced lockdowns and trading restrictions.
Wesfarmers managing director Rob Scott said it was the “most disrupted period for our businesses since the onset of COVID-19.”
The first half saw the company’s net profit after tax (NPAT) tumble 14% to $1.2 billion. Meanwhile, its revenue fell 0.1% as its earnings before interest and tax (EBIT) slumped 12%.
Around 20% of the company’s retailers’ trading days were hit with restrictions or closures, while supply chains and staff availability suffered due to the spread of the virus.
Even Wesfarmers’ usual darling – Bunnings – struggled last half. Its earnings fell 1.2% to $1.2 billion.
Perhaps unsurprisingly, the Wesfarmers share price tumbled 7.4% on the release of the company’s half-year results.
The only other news from Wesfarmers last month was regarding its acquisition of Australian Pharmaceutical Industries Ltd (ASX: API).
Its $1.55 per share bid for API – which implies an equity value of $773.9 million and an enterprise value of around $1.05 billion – officially won’t be opposed by the Australian Competition and Consumer Commission (ACCC).
The watchdog found the acquisition wouldn’t have an impact on competition in the pharmaceutical sphere.
Wesfarmers’ takeover of API is expected to be completed later this month.
The post The Wesfarmers (ASX:WES) share price dumped 9% in February. What happened? appeared first on The Motley Fool Australia.
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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