Everything you need to know about the Wesfarmers dividend

Wesfarmers Ltd (ASX: WES) will soon be paying out its final dividend for FY23 after telling investors what the payout is going to be.

The diversified business has released its FY23 result to shareholders, which included another year of growth.

In FY23, Wesfarmers grew revenue by 18.2% to $43.55 billion, earnings before interest and tax (EBIT) increased 6.3% to $3.86 billion and net profit after tax (NPAT) went up 4.8% to $2.47 billion.

Wesfarmers dividend

The board of Wesfarmers decided to declare a fully franked final dividend of $1.03 per share, which was an increase of 3% compared to the FY22 final dividend of $1 per share.

This led to the full-year ordinary dividend being $1.91 per share, which was a 6.1% increase year over year.

Based on the EPS generated by the business, the dividend payout ratio is around 8%.

The ex-dividend date for the FY23 final dividend is 30 August 2023, which is very soon – it's the middle of next week! This means investors need to own Wesfarmers shares by the end of 29 August's trading to be entitled to this upcoming payment.

Wesfarmers revealed that it will pay this dividend on 5 October 2023.

If investors want to take part in the dividend reinvestment plan (DRP), the election date cut-off is 1 September 2023 at 7pm. There is no discount price on the shares if shareholders take part in the DRP.

For New Zealand investors, this payment also carries a 10 cents New Zealand franking credit of NZ 10 cents per share.

What is the yield?

Based on the current Wesfarmers share price, the full-year dividend equates to a grossed-up dividend yield of 5.4%.

With the final dividend alone, it's a grossed-up dividend yield of 2.9%.

Wesfarmers said that the final dividend reflected a strong operating performance.

What could the payout be in FY24?

Forecasts are subject to change, but currently on Commsec, the estimate is that Wesfarmers would pay an annual dividend per share of $1.92 in FY24, which would only be slightly higher than the FY23 payout of $1.91 per share.

Therefore, the grossed-up dividend yield for FY24 could be 5.4%.

However, the forecast numbers on Commsec suggested the annual dividend per share was going to be $1.88, so it's possible that the FY24 payout could also be bigger (or smaller) than expected.

Wesfarmers share price snapshot

The Wesfarmers share price is currently up by 2.8% today and it's up 6.6% in the last 12 months.