Wesfarmers Ltd. (WES.AU) saw its shares plummet 5.11% during intraday trading on Thursday, a sharp reversal following the release of its first-half financial results.

While the Australian conglomerate reported a 9.3% rise in net profit to A$1.60 billion, beating estimates, and increased its interim dividend to A$1.02 per share, management warned of persistent challenges. The company highlighted that high cost-of-living pressures, a recent interest rate hike, and uncertainty regarding inflation are affecting consumer sentiment. Furthermore, higher operating expenses are weighing on business confidence and spending.

Adding to investor concerns, Wesfarmers announced that production ramp-up plans at its Covalent Lithium joint venture have been extended due to intermittent odor issues, with engineering works now expected to be completed by mid-2026. This cautionary outlook on the macroeconomic environment and operational setbacks appears to have overshadowed the positive half-year figures, leading to the significant sell-off.