VIL - Veritas Investments Limited

[winner69]

lol. Every time I read one of your posts, I need to work out if you are taking the piss. Clearly you are on this one...

Or maybe not. They did reach forecast. They are on a historical pe of 8.5. And they have had a tough second half because of high beef and lamb prices. They have even stated that things are looking up. Tasty dividend yield. Crickey, maybe I need to consider buying in again?

NO! Someone slap me.

That's better.

The the only reason they reached forecast was because of the acquisition. They failed to open 4 stores. They have given no guidance on opening more in FY15. Their focus now seems to be on acquisitions.

There business model is essentially to get the franchisees to sell as much as they can. That way VIL get there cut on the carcass purchases on the way through and a cut of all non meat sales. No blood on the VIL hands, just dirty fingers from counting the cash.

Take as much from the franchisees without causing too many to go broke is the optimum return for shareholders

Even that cheap milk the franchisees sold VIL probably collected a few cents while the franchisee sold at a cost.

So if meat sales are struggling what else can we get them sell. So expanding into veggies, condiments and all sorts of things helps VIL income. But if a Mad Butcher shop looks more like a 4 Square they might have problems.

Worry that Mad Butcher store numbers not going to plan but hard to find butchers with enough capital or ability to front up and set up a new shop.

Going into making patties is aligned to meat but a bit outside the business model. Making stuff has its inherent risks and I'd different to just collecting a cut on everything on the way through. No doubt they charge their franchisees more than enough to make the patties division quite a profit centre.

Nice clean business, just get the franchisees to do all the hard yakka

[noodles]

There business model is essentially to get the franchisees to sell as much as they can. That way VIL get there cut on the carcass purchases on the way through and a cut of all non meat sales. No blood on the VIL hands, just dirty fingers from counting the cash.

If they were so evil, there would be no stores. They are a buying group. Franchisees get the advantage of marketing and low cost meat.

HEDGING
Mad Butcher performs poorly when meat prices are high.
PGW perform well when meat prices are high.
Perhaps Mad Butcher is a natural hedge to PGW???

[winner69]

If they were so evil, there would be no stores. They are a buying group. Franchisees get the advantage of marketing and low cost meat.

HEDGING
Mad Butcher performs poorly when meat prices are high.
PGW perform well when meat prices are high.
Perhaps Mad Butcher is a natural hedge to PGW???

Didn't say evil ....I said take as much as they can without the franchisees going broke. Maximise your return.

Yes a buying group. They do the organising and all that but it appears as if 'rebates' are quite high which leaves franchisees margins a bit thin. Franchisees would have be better off they go together and formed a cooperative and shared the $5m profit or whatever it was amongst themselves.

Good model for shareholders .....can never really go broke and keeps churning out the cash

Interesting abbreviation re PGW/VIL

[Sideshow Bob]

Mad Butcher performs poorly when meat prices are high.
PGW perform well when meat prices are high.
Perhaps Mad Butcher is a natural hedge to PGW???

Would see domestic meat prices heading one way. Beef prices in the US going crazy - grinding prices up around 35% in the 3 months in the US, China still growing (albeit with the usual Chinese issues), lamb supply shrinking, and many would say the dollar overvalued and potential for a fall.

[noodles]

Well I did not expect this. Nosh is a good store, but I struggle to see too much in the way of synergies with their other businesses. Just the meat department.

Clearly they don't make any money as there are no profit mentioned. The buy price is "not material". Maybe that is because they have so much debt. No mention of being eps acreditive.

Pretty poor release in my opinion. Gives me no way of working out if it is positive from a financial perspective.

[etrader]

Well I did not expect this. Nosh is a good store, but I struggle to see too much in the way of synergies with their other businesses. Just the meat department.

Clearly they don't make any money as there are no profit mentioned. The buy price is "not material". Maybe that is because they have so much debt. No mention of being eps acreditive.

Pretty poor release in my opinion. Gives me no way of working out if it is positive from a financial perspective.

Nosh was basically taken over last year 84 percent by a wealthy businessman to bail out the debt then and their stores are looking so empty as it is there's only one way they will go and that will be meat meat meat.

They're responsible for the debt and they probably paid no more than $2 mill for the rest.

[Balance]

Well I did not expect this. Nosh is a good store, but I struggle to see too much in the way of synergies with their other businesses. Just the meat department.

Clearly they don't make any money as there are no profit mentioned. The buy price is "not material". Maybe that is because they have so much debt. No mention of being eps acreditive.

Pretty poor release in my opinion. Gives me no way of working out if it is positive from a financial perspective.

Fact that they release it well after market close on a Friday tells you all you want to know - not a deal they want to shout from the roof top.

Something smells and it's not the discarded meat in the rubbish bin.

[etrader]

Looks like a good buy for VIL

[Balance]

Nosh were heading for liquidation again after the latest bail out. They sold for 1.7 mill plus liabilities and stock. Mad butcher possibly might turn this around but the former CEO totally stuff this business. It's a non material transaction to takeover 7 leases

Thanks for that.

[boofters]

Thanks for that.

This is a watch this space for me. Interestng if they decide to turn mad butcher shops into NOSH where it makes sense..and even vice versa.
My wife spends enough at the dominion road NOSH and every time I've been there it's busy. Get some economies of scale going and surely this fits well in the food retail landscape?
They have also picked up the Black Rock meat brand used within NOSH. Now they can make it all centrally and distribute...
very interesting I reckon...good luck to them, will take a punt on any further dip.