HLG - Hallenstein Glasson [Archive] - Page 12

Gisborne Grumbler

05-12-2018, 06:01 PM

All I'm saying mate is last year the loss making Storm brand made up 2% of the gross sales so a 4.8% gross sales increase on a normalized basis is more like a 6.8% increase on a like for like basis comparing Glassons and Hallensteins sales brands only, year on year.
Agree that's probably already baked into the cake at this price but nonetheless that's a solid result compounding on the previous two years solid sales increases. HLG does mention at some length in the annual report the effect of the increased petrol prices, which as mentioned earlier, has since abated. Its not the only retail company to feel the effect of rising petrol prices over the last few months is it ! Likewise the exchange rate challenge has also recently abated and we're back in the normal zone v the $US

Although to be fair Beagle, Store sales in 1H declined by 11% in 1st qtr. Also they opened 2 new Glassons stores in AU in the first quarter and 2 Hallensteins stores in NZ . So I think the "what were same store sales hmmm" is a fair question. One which they seem to not disclose for some reason...maybe the reason for the lack of enthusiasm.

Gisborne Grumbler

05-12-2018, 06:02 PM

Although to be fair Beagle, Store sales in 1H declined by 11% in 1st qtr. Also they opened 2 new Glassons stores in AU in the first quarter and 2 Hallensteins stores in NZ . So I think the "what were same store sales hmmm" is a fair question. One which they seem to not disclose for some reason...maybe the reason for the lack of enthusiasm.

*storm sales decline*

winner69

05-12-2018, 06:08 PM

winner69

05-12-2018, 08:46 PM

Moosie (I think) wood reckon a falling wedge from recent high of 630 odd

moosie latest report - its a symmetrical triangle with either upside breakout or downside breakdown potential. The trend is usually a continuation of current one (ie DOWN).

couta1

05-12-2018, 09:30 PM

moosie latest report - its a symmetrical triangle with either upside breakout or downside breakdown potential. The trend is usually a continuation of current one (ie DOWN).

You don't need fancy triangles to determine the above, just take a look at the bolly bands coming together and deduct the 24c divvy amount come Friday and see what the trend will look like.

BlackPeter

06-12-2018, 08:02 AM

You don't need fancy triangles to determine the above, just take a look at the bolly bands coming together and deduct the 24c divvy amount come Friday and see what the trend will look like.

If couta and moosie agree it appears all the indicators are aligned ;);

Might not be the best of times to apply a dividend stripping strategy ...

winner69

06-12-2018, 08:28 AM

If couta and moosie agree it appears all the indicators are aligned ;);

Might not be the best of times to apply a dividend stripping strategy ...

And it looks like a Death Cross the other day ....but often that’s good buying eh

But still above 200MA .....no worries

And snow leopard said there’s a steady uptrend in place ....something like higher highs and higher lows he said the other day ... that’s good

Snow Leopard

06-12-2018, 03:08 PM

moosie latest report - its a symmetrical triangle with either upside breakout or downside breakdown potential. The trend is usually a continuation of current one (ie DOWN).

So I have verified that that is indeed what the Moosie wrote, and it is nice to see that there is a little forum for him :).

Now isn't it fascinating that

a) TA tells us that prices may go up or down - we learn something every day.

b) despite the price going UP before entering this symmetrical triangle that the Moosie thinks the current trend is DOWN. I think the Moosie is seeing what he wants to see and is then trying to hang some TA on it.

Anyway the price will do what the price will do and will almost certainly go UP, DOWN or SIDEWAYS.

Disc: Currently hold some HLG, would not buy more at the current price, but DYOR.

Leftfield

06-12-2018, 04:52 PM

Is that the same Moosie who invested heavily in BIG on the ASX? :scared:

BlackPeter

06-12-2018, 05:30 PM

Is that the same Moosie who invested heavily in BIG on the ASX? :scared:

It is. From memory - for a time was the TA on BIG impeccable .. and lots of people made heaps of money with it. Just a timing issue.

Why are you asking? I didn't yet met an honest investor who never lost money. Did you? Moosie is quite TA focussed. Typical hit rate of TA predictions is around 60% - which is better than flipping a coin, but by no ways infallible. Losses are inevitably part of the game ...

winner69

07-12-2018, 01:33 PM

I assume we need to adjust charts for the divie so it doesn’t look so ugly

bull....

07-12-2018, 04:55 PM

hope no one chased the div , its adjusting for there down grade now

couta1

07-12-2018, 05:19 PM

hope no one chased the div , its adjusting for there down grade now Yes I did add more for the divvy, down grade will get reversed after a couple of great sales months ahead. PS -AGM might shed some more light on things as well. PPS - Plenty of long term smart money holding this stock.

winner69

07-12-2018, 05:50 PM

HLG was 341 ex divie this time last year

Been a good year eh

Another 150 over next 12 months andvthe share price will be 640

Those big guys (inc Couts) who never sell will be happy ...

McGinty

07-12-2018, 05:56 PM

Yes I did add more for the divvy, down grade will get reversed after a couple of great sales months ahead. PS -AGM might shed some more light on things as well. PPS - Plenty of long term smart money holding this stock.

I hope you're right there Couta.

As mentioned on the other forum, I sold down HLG for 3 main reasons (red flags) I've observed this week. Chances are this current seller has more shares to sell than you have capital to absorb them. Smart money or not, the chart paints a clear picture of what's happening.

Quite possibly there's more bad news to come out in the AGM and this seller knows it.

KW's rule comes into action with HLG now as well.

winner69

07-12-2018, 06:10 PM

I hope your right there Couta.

As mentioned on the other forum, I sold down HLG for 3 main reasons (red flags) I've observed this week. Chances are this current seller has more shares to sell than you have capital to absorb them. Smart money or not, the chart paints a clear picture of what's happening.

Quite possibly there's more bad news to come out in the AGM and this seller knows it.

KW's rule comes into action with HLG now as well.

I doubt whether there is somebody with a decent holding selling let alone somebody who knows there more ‘bad news’ to be announced at the AGM

Was the recent update ‘bad news’ anyway - sales effectively up 7% and this stuff about challenging market conditions is what retailers always say. It’s Rod Dukes favourite phrase and HLG say that a lot.

Chart a bit sad ...just market sentiment towards retail orientated stocks isn’t that high at the moment

Then again you may be reading this right and the last 6 weeks have been a disaster and it’s been a slow start to the peak season and margins have tumbled

McGinty

07-12-2018, 06:28 PM

I doubt whether there is somebody with a decent holding selling let alone somebody who knows there more ‘bad news’ to be announced at the AGM

Was the recent update ‘bad news’ anyway - sales effectively up 7% and this stuff about challenging market conditions is what retailers always say. It’s Rod Dukes favourite phrase and HLG say that a lot.

Chart a bit sad ...just market sentiment towards retail orientated stocks isn’t that high at the moment

Then again you may be reading this right and the last 6 weeks have been a disaster and it’s been a slow start to the peak season and margins have tumbled

I won't be able to confirm until the SSH notice comes out, but I suspect that the same entity that pushed the price up over $6, is the same one that is continuously selling down.

I watch the market enough to know that this isn't 'Mum & Dad' investors selling (too many 10k and 15k lots of shares on the sell side that hit the buy).

It will be an interesting week next week, with the AGM.

winner69

07-12-2018, 06:54 PM

I won't be able to confirm until the SSH notice comes out, but I suspect that the same entity that pushed the price up over $6, is the same one that is continuously selling down.

I watch the market enough to know that this isn't 'Mum & Dad' investors selling (too many 10k and 15k lots of shares on the sell side that hit the buy).

It will be an interesting week next week, with the AGM.

Those bloody Aussies eh .....weren’t committed shareholders for long eh.

McGinty

07-12-2018, 07:01 PM

Those bloody Aussies eh .....weren’t committed shareholders for long eh.

What is J.M.Keynes saying when the facts change?

Maybe they're just following a similar ethos

winner69

07-12-2018, 07:15 PM

What is J.M.Keynes saying when the fact change?

Maybe they're just following a similar ethos

Would still be ahead at the current prices

But a heck of a lot to go if they have decided the facts have changed.

McGinty

07-12-2018, 07:22 PM

Would still be ahead at the current prices

But a heck of a lot to go if they have decided the facts have changed.

Too true, it's hard to exit a 6.9% stake by just selling into retail investors.

They can drop around 600k shares before the are required to submit an SPH notice. (last five days approx 500k in volume, but then you have retail investors in there as well - like me)

Next week will be interesting

pg0220

07-12-2018, 08:31 PM

I think the valuation of HLG is mainly based on dividends. Dividends so far has increased and seems aligned with the price movement as well.

When I look at the reports for the last 3 years, they used to spend on dividend more than they profit, taking funds out of retained earnings. However, for the recent year's report, they actually accumulated the retained earnings even after paying a lot on dividends.

As long as they keep the dividends the same rate as the latest ones, I think SP will adjust to it. Current dividend yield is 0.44/4.85 = 9% which shows the current SP is undervalued. I think the current market sentiment has put a lot of pressure on the selling side too.

Well, what do I know, it will be interesting to see what happens next week...... Hopefully good news comes.........

couta1

07-12-2018, 08:35 PM

Would still be ahead at the current prices

But a heck of a lot to go if they have decided the facts have changed. They were buying up to $6 so they would be underwater if indeed its them.

winner69

07-12-2018, 08:49 PM

They were buying up to $6 so they would be underwater if indeed its them.

There first 3.4 million (5%) was at $4.17 and they have only disclosed another 1% movement since

couta1

07-12-2018, 09:34 PM

There first 3.4 million (5%) was at $4.17 and they have only disclosed another 1% movement since As at 21st Aug they held 6.91% and their buying of 686k shares between Aug 6th and 21st was between $5 and$6. I'm guessing their average is around the current price.

McGinty

10-12-2018, 08:39 AM

I won't be able to confirm until the SSH notice comes out, but I suspect that the same entity that pushed the price up over $6, is the same one that is continuously selling down.

I watch the market enough to know that this isn't 'Mum & Dad' investors selling (too many 10k and 15k lots of shares on the sell side that hit the buy).

It will be an interesting week next week, with the AGM.

And there we have it, Grahger sold 300k last week.

I wonder how many more they are going to off load?

winner69

10-12-2018, 08:45 AM

And there we have it, Grahger sold 300k last week.

I wonder how many more they are going to off load?

Yes mcginty — you read that correctly

The facts have changed so my view is now that a large shareholder is selling down. (Had to say that eh)

couta1

10-12-2018, 08:50 AM

Yes mcginty — you read that correctly

The facts have changed so my view is now that a large shareholder is selling down. (Had to say that eh) A Johnny come lately large shareholder not a long term one like the rest of the Top 20.

winner69

10-12-2018, 08:54 AM

A Johnny come lately large shareholder not a long term one like the rest of the Top 20.

The other bit of mcginty’s ‘Theory’ was that the party selling knew something (not so good)

And with their other (long term) holding in like companies in Australia they probably have a good feel for what’s going on.

Don’t seem to be selling other stuff they have declared interests in (just from a quick look)

oldtech

10-12-2018, 11:56 AM

Big sale on today ... $4.60 and counting

Beagle

10-12-2018, 12:00 PM

Big sale on today ... $4.60 and counting

Ouch...hope the annual meeting on Wednesday has some soothing words. I don't like seeing my free shares in freefall.

dreamcatcher

10-12-2018, 12:01 PM

oldtech

10-12-2018, 12:03 PM

People who brought HLG @ $3 would always have a different view to buyers between $5 - $6

One would say a "GREAT INVESTMENT" the other "WHAT A DOG" eating away at capital..............?

But saying that the whole market looks BS anyway

Yep, I originally bought at $3.15 last year, so not too worried.

Well ... not TOO worried ... yet ...

Beagle

10-12-2018, 12:09 PM

I bought at $2.70 and sold half at $5.50 a while ago to get to a free carry situation. Pretty happy with that decision now but it didn't look quite so clever when the SP was $6.30

dreamcatcher

10-12-2018, 12:34 PM

I bought at $2.70 and sold half at $5.50 a while ago to get to a free carry situation. Pretty happy with that decision now but it didn't look quite so clever when the SP was $6.30

WISE................ oldtech & Beagle for your PAST vision and eliminating capital loss now your choice is only FUTURE company direction

couta1

10-12-2018, 02:23 PM

30k shares drops the price by 30c, trouble with an illiquid stock, Grahger not selling today though on the positive side.

carrom74

10-12-2018, 02:33 PM

30k shares drops the price by 30c, trouble with an illiquid stock, Grahger not selling today though on the positive side.

Thanks Couta... thats more re-assuring...

I am still holding and i am not selling until i get some clarity when the AGM notes come out.

I hope you are too...

winner69

10-12-2018, 02:35 PM

30k shares drops the price by 30c, trouble with an illiquid stock, Grahger not selling today though on the positive side.

Illiquid stocks can go up just as fast ...even faster sometimes ....eh Couts

Antipodean

10-12-2018, 02:37 PM

Market volatility is hitting even the more stable companies. I'm in it for the long haul so not overly fussed with the recent few days performance.

At this rate on the 17th I may look into a pseudo DRP / top up.

Beagle

10-12-2018, 02:38 PM

WISE................ oldtech & Beagle for your PAST vision and eliminating capital loss now your choice is only FUTURE company direction

I think somewhere in the low 40 cents per share this year for eps. Choose whatever PE you think is appropriate.

couta1

10-12-2018, 02:49 PM

Illiquid stocks can go up just as fast ...even faster sometimes ....eh Couts Sure can, looks overdone to me now.

winner69

10-12-2018, 02:55 PM

Grahger average buy price was $4.55. The ones they’ve sold average sell $5.37

The 3.32 million they still had Friday average is $4.27 (including sells)

Future?

McGinty

10-12-2018, 03:02 PM

30k shares drops the price by 30c, trouble with an illiquid stock, Grahger not selling today though on the positive side.

Looking at the sell side, it looks like Grahger are still selling (There are a few large numbers in there). Time will tell as they still can sell 340k before their next SPH notice.

But, yes agreed in the fact that this being an illiquid stock isn't helping today.

winner69

10-12-2018, 03:10 PM

I see Grahger ceased to be a shareholder in Lovisa a month or so ago

McGinty — Maybe the facts have changed about retail in Australia and they quitting the sector altogether

Who knows ....are they still in Specialty

McGinty

10-12-2018, 03:16 PM

Beagle

10-12-2018, 03:32 PM

I think somewhere in the low 40 cents per share this year for eps. Choose whatever PE you think is appropriate.

So folks, suppose due to the temporarily lower currency, (now reverted back to the long term 68-73 cent range) they make 43 cps this year against 48 cps last year (normalised for sale of storm) What is the correct PE given they are still growing sales at circa 7% per annum, (normalised for sale of loss making storm brand) in this tougher retail environment, (which might last for a while or might not). Is a forward PE of about 12 fair (12 x 43 cps = $5.16) or are we a bit lower now given the overall negativism in the market. Maybe a PE of 11 = $4.73 ? is very good value even in this market considering they are still growing sales at a good rate in a very tough market unlike some companies. Selloff seems a little overdone but just like it was obviously overbought at $5.70 and went all the way to $6.30 maybe this still has legs to the downside even yet :eek2:

winner69

10-12-2018, 04:25 PM

couta1

10-12-2018, 04:42 PM

Yep winner, Feb would be the time to make a decision about seriously adjusting ones holding, sales could very well go gangbusters over the next couple of months,not enough concrete facts at this point in time to be sure of the sales projections.

Beagle

10-12-2018, 04:49 PM

Even though they said they will provide a further trading update at the Company’s Annual General Meeting I doubt they will much more to what we know already

We already have the sales growth to end of November and the challenging market bit so not much more to add is there unless they feel inclined to mention margins. Just have to wait until Feb before we really know what’s going on.

Announcements are generally pretty brief at the best of times and share price not important to the Board anyway.

A couple Directors getting their responses ready to answer the Shareholders Association calling them old fuddy duddys ...that’s quite funny

They've talked about margin under pressure already in the annual report. Was pretty obvious really given where the currency was a few months ago and obvious this summer's stock was ordered based on an exchange rate materially lower than the current one. This is a one-off though because we are now back in the normal long term currency range and fuel prices have also normalised so you would think these one offs would have been already understood by the market. I guess Grahger buying forced it up to an irrational high of $6.30 and now they're selling it'll force it down to an irrational low over time. Today a situation of shoot first and ask questions later now that Grahger have disclosed their reduce bias.

winner69

10-12-2018, 05:34 PM

One thing for sure at the AGM is that Chairman Bell won’t be saying ‘The Board believes that the share price is seriously undervalued ...etc etc”

Only delusional Boards think like that ...the HLG Board only worries about the day to day performance of the company ...whatever the share price is what it is and beyond their control.

dreamcatcher

10-12-2018, 05:35 PM

Difficult for Clothing Retailers forecasting too far ahead as too many variants regarding their styling, colour choices, late deliveries, weather, economic outlook, exchange rate, reliance on finicky public etc in a very cyclical industry. This could head back to a 3-in-front unless results are exceptional but even then momentum well broken and punters may reconsider their options to sell/buy

Spike in last few months of NZ dollar hasn't helped dual listed stocks ?

Beagle

10-12-2018, 05:40 PM

Disc: I sold down some of my free shares today with the reason being this is a capital preservation measure as its hard to see northwards momentum being reestablished with Grahger selling down.

percy

10-12-2018, 05:45 PM

Disc: I sold down some of my free shares today with the reason being this is a capital preservation measure as its hard to see northwards momentum being reestablished with Grahger selling down.

Wise.
I don't think Grahger will want to buy into another illiquid NZ retailer again.
Be fun watching them trying to exit.

couta1

10-12-2018, 06:27 PM

Wise.
I don't think Grahger will want to buy into another illiquid NZ retailer again.
Be fun watching them trying to exit. They won't be able to exit completely without a good loss.

winner69

10-12-2018, 07:04 PM

Slow start to month retail sales wise .....hope it picks up

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12174229

Beagle

10-12-2018, 07:15 PM

Maybe this is what the Aussie guys are seeing ? https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12174411
Biggest housing correction since records began in 1980 leading to soft retail spending. ASB economists the week before last suggesting there is a correlation between Sydney and Auckland house prices.
Maybe a slightly quieter year for retail this summer ? especially seeing as we had a boomer of a summer last year with the weather.

couta1

11-12-2018, 05:47 PM

Kiwis heading to the Pub and Malls with their extra cash from petrol savings, next 2 months could very well surprise on the upside.

Beagle

12-12-2018, 10:01 AM

Sales were up 7.2% for the first 7 weeks or so and then 4.8% the other day to the end of November and now only 4% up and now this from the outlook comments

"Whilst the new financial year started well, the outlook for the balance of this season and into the new calendar year remains unpredictable. Australia and New Zealand continue to be increasingly challenging retail markets. Consumers on both sides of the Tasman face ever-increasing pressures and challenges on their discretionary spend, and businesses in both countries are experiencing legislative change as well as challenging exchange rates and cost increase pressures".

Ouch, no wonder the SP has tanked. Margins are clearly under a material amount of pressure.

bull....

12-12-2018, 10:08 AM

the headline running on my news feed says outlook uncertain for 2nd half , increased costs putting pressure on margins. lower nz/aus dollar

looks like another downgrade next yr coming

couta1

12-12-2018, 10:09 AM

I'm waiting till Feb before I make any decisions on my holding, another big divvy a couple of months after that anyways.

McGinty

12-12-2018, 10:09 AM

Raz

12-12-2018, 10:19 AM

It is interesting trend, I hate the lack of liquidity on this share and as a result will not hold a xoxo shareholding again. Been selling on the drip for what seem ever now:)

Construction sector downturn and its effect on the wider economy disposable income is certainly more pronounced in Australia than here currently.

ps Wife went over to Melbourne to do her christmas shopping and given how much she placed on credit cards I would have thought Aussie retail numbers should hold up.

percy

12-12-2018, 10:22 AM

percy

12-12-2018, 10:24 AM

Not a good tone in the forecast, was it?

No mention of Margins or NPAT like last years forecast, just the difficulties. As Beagle mentioned the Sales growth figure is sliding back as well the closer to Xmas we get.

Happy to be sitting this one out.

Yes the February update will be "judgement day".
On line sales at 12.8% is solid.
They always impress my with their logistics and stock control.
A great retailer.

Beagle

12-12-2018, 10:24 AM

"Future Outlook

While the trading environment in both New Zealand and Australia remains challenging, the sales for first 18 weeks of the new financial year (from 2 August 2018 to 9 December 2018) are 4% ahead of the same period last year. However, because the December and January key trading months, which contribute such a large proportion of sales and profit for the season, are largely still ahead of us, it is not possible to reliably forecast our results.

The outlook for the second half of the year remains uncertain as increasing costs (such as fuel, freight, electricity etc) and the lower New Zealand and Australian dollar puts pressure our trading margins. We will however remain focused on improving our market share and customer experience in the New Zealand and Australia fashion apparel markets in which we operate, and keep a tight control over our operating costs. We will also work to ensure our Glassons and Hallenstein Brothers brands remain market leaders in their respective market segments"

Not exactly positive is it. With Grahger selling down I struggle to see how +ve momentum can be reestablished. I sold half on the way up at $5.50 and some there on the way down and again more recently at slightly lower prices and am now out. That 4% by implication is 4.0% seeing as they have not defined it further. This is quite a big change from 4.8% for the period to 30 November. To move the year to date needle that much in only 9 more trading days implies early December trading has been quite considerably softer than the same 9 day period last year. A sign of things to come for the summer season or just a short term aberration ?...you folks be the judge.

Arbroath

12-12-2018, 10:30 AM

Not exactly positive is it. With Grahger selling down I struggle to see how +ve momentum can be reestablished. I sold half on the way up at $5.50 and some there on the way down and again more recently at slightly lower prices and am now out.

When I exited in August between $5.40-$6.00 for the very reasons that are now developing I was told my view of value was less important than the big Aussie fund that was buying at the time. That may of been true short term due to their deeper cheque book but I'm having the last laugh now they have a big holding they can't get out of very easily in a changing environment.

Beagle

12-12-2018, 10:35 AM

When I exited in August between $5.40-$6.00 for the very reasons that are now developing I was told my view of value was less important than the big Aussie fund that was buying at the time. That may of been true short term due to their deeper cheque book but I'm having the last laugh now they have a big holding they can't get out of very easily in a changing environment.

Indeed, it is sometimes a real advantage having a smaller holding that can be more readily liquidated. I wouldn't be entirely surprised to see this with a 3 something handle in due course. Might be very good buying again then :)

McGinty

12-12-2018, 10:43 AM

Indeed, it is sometimes a real advantage having a smaller holding that can be more readily liquidated. I wouldn't be entirely surprised to see this with a 3 something handle in due course. Might be very good buying again then :)

I'm looking forward to this $2.70 entry, that you've mentioned a few times. Maybe 2019 will provide us one of those opportunities again :D

Arbroath

12-12-2018, 10:46 AM

couta1

12-12-2018, 10:46 AM

Indeed, it is sometimes a real advantage having a smaller holding that can be more readily liquidated. I wouldn't be entirely surprised to see this with a 3 something handle in due course. Might be very good buying again then :) I don't really care, I've had some massive divvies over the last couple of years, I don't see Hickman and Glasson being too worried either.

bull....

12-12-2018, 10:49 AM

Indeed, it is sometimes a real advantage having a smaller holding that can be more readily liquidated. I wouldn't be entirely surprised to see this with a 3 something handle in due course. Might be very good buying again then :)

could be right, long term charts show this swings in a huge range around 3 was the last bottom

Brain

12-12-2018, 10:57 AM

Exceptionally well managed company and I expect them to continue to make the best decisions they can. The sky is not falling in.

Mickey

12-12-2018, 11:09 AM

Me either Couta. I entered at 3.33 and if it goes down below that - I'll buy more. I'm in it for the divvies and so the paper gain/loss elevator can do what it wants as long as the golden eagle lays an egg in my bank account every 6 months :-)

Beagle

12-12-2018, 11:27 AM

Agree - it is an excellent company operating in a tough industry. Next year maybe $3.00-$3.50 if the summer is difficult and they'll be worth a look again.

Of course they still might surprise in February but my model guesses $20m-$23m for FY19 at this early stage

What gross profit percentage are you modelling ? They achieved 61% last year and 58.8% the year before that. I reckon ~ 58% gross profit percentage this year which leads me more toward $22-25m but at say $23m (on 59.6m shares) where we have common ground that's eps of 38.6 cps. The harder question is what's the right PE ? I don't think we're headed back to $2.70 again or anywhere near there but mid $3's is possible or even low $3's if the market overall is really bearish or if the market update in February 2019 is disappointing. Agree the sky is not falling in but I think the risk to the SP even after the recent very severe correction remains to the downside.

McGinty

12-12-2018, 11:29 AM

HLG early Christmas sale on now! Prices heavily discounted and slashed over 20% from last week.

Get in early before stock runs out. lol

winner69

12-12-2018, 12:46 PM

There is so much wrong in this paragraph the reporter should hang his/her head in shame (but won’t because he/she is pretty sure it’s accurate)

The company managed to widen gross margins to 68.4 percent in the 2018 financial year from 58.9 percent in 2017, despite a 12 percent increase in employee costs to $51.6 million.
http://www.sharechat.co.nz/article/a1f67b71/hallenstein-glasson-wary-of-margin-squeeze-in-second-half.html?utm_medium=email&utm_campaign=Hallenstein%20Glasson%20wary%20of%20m argin%20squeeze%20in%20second%20half&utm_content=Hallenstein%20Glasson%20wary%20of%20ma rgin%20squeeze%20in%20second%20half+CID_da4f41bca6 d89af5e3eb356b051b09f7&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticlea1f67b71hallen stein-glasson-wary-of-margin-squeeze-in-second-halfhtml

winner69

12-12-2018, 01:06 PM

HLG early Christmas sale on now! Prices heavily discounted and slashed over 20% from last week.

Get in early before stock runs out. lol

Hallensteins website says 30% off ...so a bit of a way to go

macduffy

12-12-2018, 02:10 PM

There's not a lot of top companies on the NZX that offer the trading opportunities that HLG does from time to time. Will be great buying in due course when the downtrend breaks - and equally, great selling, when the opposite occurs!

Onion

12-12-2018, 03:04 PM

Hallensteins website says 30% off ...so a bit of a way to go

Yahoo Finance says HLG SP off 29.55% over the last 3 months. So yeah, pretty close to 30%!

Snow Leopard

12-12-2018, 03:36 PM

Saw this in the CEO's address:

"Additionally we have a number of new and innovative customer facing technologies in store. “Be the D.J.” where customers can choose their own music whilst they shop."
Could be worth turning up with asking to them play a Shostakovich (https://www.classicfm.com/composers/shostakovich/guides/dmitri-shostakovich-life/)symphony.

The share market loves an outlook of life is tough, and we do not know whether we will make any profit next year.

So the share price will probably undershoot fair value but until then here is the four yorkshiremen sketch:

https://www.youtube.com/watch?v=ue7wM0QC5LE

Beagle

12-12-2018, 04:31 PM

Agree - it is an excellent company operating in a tough industry. Next year maybe $3.00-$3.50 if the summer is difficult and they'll be worth a look again.

Of course they still might surprise in February but my model guesses $20m-$23m for FY19 at this early stage

I've done a bit more work on this now and I tend to agree now with your profit range assessment (while noting its still very early days).
Same store sales growth is negative so there are cost implications there on top of normal price increases for labour, leases power e.t.c. and they are saying margins are under pressure so clear implications there for the gross profit margin which could fall to as low as 57% down from 61% last year and 58.8% the year before. A lot depends upon the level of discounting towards the end of the season of course.

I note they appear to be losing sales momentum as the year unfolds. $21.5m / 59.6m shares gives eps of 36 cps. PE of 10 gives $3.60. Might overshoot on the downside down towards baseline support in the $3.30-$3.40 range. I think this is an "avoid" until Graghar have sold down quite a lot more.

winner69

12-12-2018, 04:59 PM

Sales were up 7.2% for the first 7 (actually 8 ) weeks or so and then 4.8% the other day to the end of November and now only 4% up ....

That means the last 10 weeks sales growth has been marginal at best if not negative.

Tough times

Across all brands and both Australia and NZ ....we’ll know in February

"

peat

12-12-2018, 05:11 PM

Saw this in the CEO's address:

"Additionally we have a number of new and innovative customer facing technologies in store. “Be the D.J.” where customers can choose their own music whilst they shop."
Could be worth turning up with asking to them play a Shostakovich (https://www.classicfm.com/composers/shostakovich/guides/dmitri-shostakovich-life/)symphony.

The share market loves an outlook of life is tough, and we do not know whether we will make any profit next year.

So the share price will probably undershoot fair value

I almost commented on the DJ arrangement. Not sure how that'd pan out esp if SL cranks up Dmitri. I reckon some Schoenberg might clear the floors pretty quickly. And of course Sunday morning shopping will always be improved by a Xenakis Threnody right?
But it does show they are always thinking about how to improve their business

Anyway

winner69

12-12-2018, 05:19 PM

a bit more

https://www.stuff.co.nz/business/industries/109303352/hallenstein-glasson-woos-customers-with-pyo-music-fancy-fitting-rooms

Beagle

12-12-2018, 06:03 PM

a bit more

https://www.stuff.co.nz/business/industries/109303352/hallenstein-glasson-woos-customers-with-pyo-music-fancy-fitting-rooms

Good move...one's favourite music is soul food and definitely gives you a lift and happy people are more inclined to spend money.

peat

12-12-2018, 07:36 PM

the mobile payment units in the shop , and the weekend and evening delivery options for online purchasing are actually quite innovative and customer focussed - not bad for a century old firm.

Joshuatree

12-12-2018, 08:02 PM

Dressing the manequins yourself too is great idea!:t_up:

mix and match

Raz

12-12-2018, 08:18 PM

the mobile payment units in the shop , and the weekend and evening delivery options for online purchasing are actually quite innovative and customer focussed - not bad for a century old firm.

Very standard in the US retail scene, surprised not more mainstream here...

Baa_Baa

12-12-2018, 08:42 PM

Indeed, it is sometimes a real advantage having a smaller holding that can be more readily liquidated. I wouldn't be entirely surprised to see this with a 3 something handle in due course. Might be very good buying again then :)

At least their website will keep one entertained while the SP sorts itself out. I mean the investor pages of course, Lol ;)

DarkHorse

12-12-2018, 09:12 PM

Wonder if a lot more bad weather than usual for late Nov/early Dec has affected sales?

JamieJ

12-12-2018, 09:22 PM

Stunning marketing!

https://www.glassons.com/yourglassons
We LOVE seeing your shots! So share yours with us on instagram using #glassons - you'll go in the draw to win a $100 gift voucher to use in store or online.
Plus you can shop directly from the gallery the #glassons looks you ♥ Win, win!
Pssst... don't have instagram? You can upload your image directly below.

couta1

12-12-2018, 09:34 PM

They won't be able to exit completely without a good loss. Gragher will be losing heaps from now on, that's good.

Brain

13-12-2018, 07:37 AM

[QUOTE=JamieJ;740976]Stunning marketing!

https://www.glassons.com/yourglassons

Absolutey. HLG know their business and are innovative. The future looks good.

Arbroath

13-12-2018, 08:33 AM

I've done a bit more work on this now and I tend to agree now with your profit range assessment (while noting its still very early days).
Same store sales growth is negative so there are cost implications there on top of normal price increases for labour, leases power e.t.c. and they are saying margins are under pressure so clear implications there for the gross profit margin which could fall to as low as 57% down from 61% last year and 58.8% the year before. A lot depends upon the level of discounting towards the end of the season of course.

I note they appear to be losing sales momentum as the year unfolds. $21.5m / 59.6m shares gives eps of 36 cps. PE of 10 gives $3.60. Might overshoot on the downside down towards baseline support in the $3.30-$3.40 range. I think this is an "avoid" until Graghar have sold down quite a lot more.

We're on the same page pretty much. My ballpark mid-point numbers are:

Sales $286m +3% yoy
GM 58% = c. $166m
Costs $135m (up $2m on FY18)
Tax $9m
Npat $22m

For me $3 is cheap and $4 is top end until there is more clarity. They might surprise over Xmas-NY and the opportunity could be missed but it feels very much like they have a good year, and $22m would still be a very good performance, but it is put in the shade by FY18 and the excitement that generated.

I'm particularly interested in how their online sales keep progressing as over the next 3-5 years I think that will be very important for them from a cost to serve perspective.

Beagle

13-12-2018, 08:54 AM

We're on the same page pretty much. My ballpark mid-point numbers are:

Sales $286m +3% yoy
GM 58% = c. $166m
Costs $135m (up $2m on FY18)
Tax $9m
Npat $22m

For me $3 is cheap and $4 is top end until there is more clarity. They might surprise over Xmas-NY and the opportunity could be missed but it feels very much like they have a good year, and $22m would still be a very good performance, but it is put in the shade by FY18 and the excitement that generated.

I'm particularly interested in how their online sales keep progressing as over the next 3-5 years I think that will be very important for them from a cost to serve perspective.

Thanks, yeah we're on the same page. I am assuming 58% gross profit, (with risk to the downside) and am also assuming a 3% sales increase. Agree 100% about your comment regarding online sales. It would be great if they can really drive this hard, (smoking hot digital images help) as they already have a significant retail footprint in both countries so their ability to leverage the brands to grow online sales is crucial to driving long term earnings. That said looking at the really big picture of their history its pretty sad really that this is N.Z.'s oldest listed company but hasn't grown enough in all that time to even be in the NZX50. That unfortunately speaks huge volumes for the cyclical nature of this industry in my opinion.

I did some more work on this from a dividend perspective yesterday. Assuming 14 cps interim dividend in April 2019 the 7 year average dividend is
32.8 cps fully imputed. 32.786 / 0.72 = 45.536 cps gross. At $3.50 that would give a 13% gross yield.
For what its worth despite the Graghar sell down I would be interested in getting back in around that level as my primary interest is dividend yield now that I am somewhere near approaching retirement.

The full dividend history for those interested, 2013 to my forecasted 2019 annual total is
2013 33.5 cps
2014 28.5 cps
2015 31 cps
2016 30 cps
2017 31.5 cps
2018 37 cps
2019 my forecast 38 cps (December just paid 24 cps, April 2019 my conservative forecast is 14 cps)
average 32.786 cps

BlackPeter

13-12-2018, 09:11 AM

Thanks, yeah we're on the same page. I am assuming 58% gross profit, (with risk to the downside) and am also assuming a 3% sales increase. Agree 100% about your comment regarding online sales. It would be great if they can really drive this hard, (smoking hot digital images help) as they already have a significant retail footprint in both countries so their ability to leverage the brands to grow online sales is crucial to driving long term earnings. That said looking at the really big picture of their history its pretty sad really that this is N.Z.'s oldest listed company but hasn't grown enough in all that time to even be in the NZX50. That unfortunately speaks huge volumes for the cyclical nature of this industry in my opinion.

I did some more work on this from a dividend perspective yesterday. Assuming 14 cps interim dividend in April 2019 the 5 year average dividend, (is this long enough to pick up the full cycle ?, I am not sure) is 33.5 cps fully imputed. 33.5 / 0.72 = 46.53 cps gross. At $3.58 that would give a 13% gross yield.
For what its worth despite the Graghar sell down I would be interested in getting back in around that level as my primary interest is dividend yield now that I am somewhere near approaching retirement.

I think winner published recently some good charts showing the cycle, but can't find them now. Just looking at the SP movement, it might be safer to assume a 6 (+/-1) year cycle. Recent peaks have been in 2006, in 2013 and 2018. To be fair, there was as well some sort of interim peak in 2010, but not sure we should count that, it looks more like SP got at that stage a bit ahead of itself.

Independent from the fundamentals and the cycles - the recent drop looks shocking. I'd assume that while the SP will midterm keep falling to a mid $3 handle, there should be short term some bounce back. Nearly tempted to ride that bounce ... it is only - I found that I am not particular good in timing bouncing cats, no matter whether they are dead or alive ;);

Beagle

13-12-2018, 09:14 AM

Thanks BP, I reworked that now as you can see above and went with a 7 year average. I agree, in hindsight it was never worth anything like $6.30.
Yeah mate...I try and stay away from bouncing cats...usually this old dog is not quick enough and comes away with a good clawing on his snout.

couta1

13-12-2018, 10:29 AM

Gragher have taken the pedal off the metal today, probably realised they are going to lose too much with their gung- ho selling and need to be a bit more savvy.Lol

McGinty

13-12-2018, 10:42 AM

Gragher have taken the pedal off the metal today, probably realised they are going to lose too much with their gung- ho selling and need to be a bit more savvy.Lol

8 days of them selling has resulted in a 23% drop in price (allowing for the 24c divie), so you could be right with them "taking the pedal off the medal today".

They would want to entice some bargain hunters out to push the price back up. So and a few days/weeks without hitting the sell will give the market confidence again. Grahger did this back in Oct and Nov - continued selling followed by a break which resulted in a corresponding rally.

winner69

13-12-2018, 11:03 AM

Beagle

13-12-2018, 11:12 AM

Hey Winner, how long do you reckon we have to wait for this to go full cycle to the downside again and then buy in ? Might be a while eh ? That post you made just a week or two ago about this reverting to $3 at some stage was very prophetic mate. What an Awesome Cool Cat you are :)

couta1

13-12-2018, 11:17 AM

BlackPeter

13-12-2018, 11:22 AM

Presumeably the Shareholders Association did vote against the old guy on the Board whose been around too long ....9% vote against. They also must have voted against Popplewell

Quite funny really .... next they be targeting Buffett and his mate for hanging around too long at Berkshire Hathaway

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/328292/292342.pdf

Actually - if you would look into their voting intentions - they didn't. They supported all directors up for election.

If you can't look into their voting intentions, than maybe it is time for you to join them. They do work for all retail shareholders, so why not support them as well: http://www.nzshareholders.co.nz/members.cfm;

But back to the median age of the HLG board. It is correct that these guys did run their company so far quite well over a long time and nobody says they should all go at once. However - the NZSA is just pointing out that it might be sensible for the board to develop a succession strategy. While old people grow older, the risk for them to become for some sort of health reasons unable to do their job is exponentially increasing with age. If this happens to several of them in a short timeframe without a proper succession strategy, than the company might get into quite troubled waters.

Here is what the NZSA put into their voting intentions related to the board composition:

The Board comprises a Non-Executive Chair, 2 Non-Executive Directors and 4 Directors who are described as
Independent although we remain less convinced because of their long tenure.

When assessing Boards’ strength, we look at the backgrounds of the Directors to ensure there is a diversity
of thinking around the Board table, and core competencies and skills are balanced and relevant to the
business. We also like to see a process of renewal and refreshment with a continuing matching of skill sets
to changes in the business.

We think shareholders would like to have more information available about the Directors. While there is one
line about each on the company’s website, and a few words at pages 50 and 52 in the Annual Report, there
is no profile of the Directors standing for election or re-election in the Notice of Meeting. HLG needs to do
better than this.

HLG has a very mature board with an average tenure of almost 20 years. The four longest serving average
over 30 years. In addition, we note that Graeme Popplewell was CEO until 2017. The Association believes
former CEOs should generally not join the Board until 2 or 3 years after they retire to give the new CEO an
ability to manage the business without their predecessor is sitting in judgement.

As would be expected from the long tenure, the Board has a good depth of industry experience, but it needs
to consider how it can ensure its membership isrenewed and refreshed in the future. In particular, we would
like to see some younger board members who reflect the aspirations of the company’s customer
demographic rather than relying on management alone.

We made similar comments last year and remain concerned that Hallenstein is vulnerable to several longstanding directors potentially having to stand down in short order.

Having said that, Hallenstein’s performance and returns to shareholders is one of the very best in the fashion
industry. The company is conservatively run, carries no debt and has moved into the digital era relatively
seamlessly. NZSA has guidelines on appropriate governance standards, but in this case, we have to
acknowledge the great results and on balance this has informed our voting intentions.

Quite appropriate - I would think ... and re Warren Buffett: I certainly would hope for the shareholders of his company that he has a good succession strategy.

winner69

13-12-2018, 11:33 AM

Yes BP my bad (again) ...must read things more closely ....yes, they did say they would vote for Bell and Popplewell

Wonder who the 9% odd who voted against them were (Devine got close to 10% support) ....maybe influenced by the Shareholders Association

Was member of Shareholders Association once but must have let it lapse.

Joshuatree

13-12-2018, 11:38 AM

BlackPeter

13-12-2018, 11:43 AM

Was member of Shareholders Association once but must have let it lapse.

I am sure they are more than happy to re-enrol you ;); Just go for it - you know, you want to: http://www.nzshareholders.co.nz/members.cfm;

Beagle

13-12-2018, 11:43 AM

Good old Hallys, its the oldest member on the NZX since 1947! Followed by Mercer(dog), EBOS and Sanford
NZX shelf life shockingly brief for too many (https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12169126)

Very cool isn't it but sad that after being listed for a whopping 71 years its not part of the NZX50 :(

winner69

13-12-2018, 11:43 AM

Good old Hallys, its the oldest member on the NZX since 1947! Followed by Mercer(dog), EBOS and Sanford
NZX shelf life shockingly brief for too many (https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12169126)

And HLG market cap today about what it was in 1993 ...25 years ago

Better not adjust for inflation eh

winner69

13-12-2018, 11:45 AM

Very cool isn't it but sad that after being listed for a whopping 71 years its not part of the NZX50 :(

Was part of the NZX50 not that long ago but got kicked out

That’s what happens to cyclicals

BlackPeter

13-12-2018, 11:46 AM

Very cool isn't it but sad that after being listed for a whopping 71 years its not part of the NZX50 :(

Actually - they used to be ... but if you look at some of the starlets (like e.g. WYN and CBL) flying through the NZX50, and if you look at some of the serial underperformers who still are (FBU anyone?) - it might not be such a great achievement to be part of the club anyway.

Beagle

13-12-2018, 11:46 AM

And HLG market cap today about what it was in 1993 ...25 years ago

Better not adjust for inflation eh

Ouch....$3 in 1993 is worth $4.97 now adjusted for inflation https://rbnz.govt.nz/monetary-policy/inflation-calculator Just as well inflation has been very low for the past 25 years isn't it !

winner69

13-12-2018, 11:55 AM

Ouch....$3 in 1993 is worth $4.97 now adjusted for inflation https://rbnz.govt.nz/monetary-policy/inflation-calculator Just as well inflation has been very low for the past 25 years isn't it !

Working the other way market cap 232m in 1993 is 384m today ....or $6.40 a share

So in ‘real inflation adjusted terms’ HLG market cap has fallen by 40% odd in 25 years

No wonder the share registry is relatively small and punters only get excited with them every now and again.

Antipodean

13-12-2018, 12:03 PM

Lots of comments on mcap past and present, anyone done the numbers of the dividends paid out since HLG listed in comparison to peers?

It'll be $3 again when they do a 2:1 share split

Beagle

13-12-2018, 02:15 PM

Working the other way market cap 232m in 1993 is 384m today ....or $6.40 a share

So in ‘real inflation adjusted terms’ HLG market cap has fallen by 40% odd in 25 years

No wonder the share registry is relatively small and punters only get excited with them every now and again.

Its a yield stock with a cyclical element. Savvy investors will work the cycles and those that time it right will do extremely well. Others will hold for yield long term and also do pretty well. It got to about $6 many years ago as you pointed out and the smart money knew it was a sell up there, just like it was this time.

macduffy

13-12-2018, 02:44 PM

Yes, it's a yield stock and generally yields pretty well! Seems to attract an inordinate amount of attention from these threads for such a small, unexciting stock! A bit like Ryman's used to be - but the savvy investor can still do well buying the dips and selling the peaks.

Ghost Monkey

13-12-2018, 03:01 PM

There are less AU Glassons stores than N.Z. and the Aussie market is about 5 times the size...they held back 10 cps in cash flow in the first half and Australian sales are growing at 60%...join the dots mate :)
I don't know any more than what's disclosed in the various company reports but I think AU expansion is the most exciting aspect to HLG and why I thin k this is a great hold, (apart from the cheap PE an d outstanding dividend yield of course).

I remain more than happy to hold long term with the way the company is growing and with the recent noticeable change in weather I am sure their Autumn / winter collection is flying out the doors. Trading on a 2018 PE of less than 10 I maintain its difficult to find better value on the NZX.

Great isn't it mate. Massive growth potential there as economies of scale and distribution efficiencies kick into gear. With the Au market being five times the size of N.Z. I'm expecting huge things from HLG in the years ahead as they accelerate Au expansion. Glassons has finally cracked the hard Au nut and we are set to enjoy great things going forward. Cash flow was 30 cps this half so they're holding back heaps of cash to fuel Au expansion but keeping quiet about it as this stage.

Even I didn't think this was a growth stock when I bought at ~ $2.80 quite a while ago. Funny how a classic dividend hounds stock has morphed into a stock with huge growth potential, not that I'm complaining ! I guess I could sell some and sit on the free ones but this dog is too cunning to play games like that, bought more so future profits and dividends will be even bigger :t_up:

Strong growth for the foreseeable future in my opinion mate. A great stock to own as part of a well diversified portfolio in tandem with seven other good stocks :p

Well, that's a wrap folks! Another outstanding performance!

winner69

13-12-2018, 03:04 PM

Macduffy — it’s really exciting when it doubles in price quite quickly at times. That gets it an inordinate amount of attention .....

.......and an inordinate amount of attention as the share price falls 20% then 30% then 49% and maybe even 50% as the punters debate whether it’s cheap or not

Nothing boring with HLG ....it’s either on a roll or down in the dumps.

Beagle

13-12-2018, 03:08 PM

Well, that's a wrap folks! Another outstanding performance!

The least you can do to be somewhat fair is to date those posts but in response I would simply say welcome to the real world mate where things change. The smart money realises this and does something about it and yes doubling your money plus many outstanding dividends in two years is a truly outstanding performance (of which anyone who followed this lead dog should be extremely pleased and grateful for the barking).

I guess you could do a monkey or possum and stare into the headlights and wonder what hit you and afterwards vent your frustration...doesn't require as much effort that way does it. I guess monkey's can throw rocks but they're not so good at sniffing out a feed eh :)

I barked very clearly it was a buy at $2.70 and also very clearly that it was full and fair value at $5.50 just over two years later and yet some people want to call me a bad dog...go figure...

Filthy

13-12-2018, 03:20 PM

Well, that's a wrap folks! Another outstanding performance!

i must say, i had a good chuckle at this ;)

Ghost Monkey

13-12-2018, 03:41 PM

Well welcome to the real world mate where things change. The smart money realises this and does something about it and yes doubling your money plus many outstanding dividends in two years is a truly outstanding performance (of which anyone who followed this lead dog should be very well pleased and grateful for the barking).

I guess you could do a monkey or possum and stare into the headlights and wonder what hit you and afterwards vent your frustration...doesn't require as much effort to contribute though does it. Monkey's can throw rocks but they're not so good at sniffing out a feed eh :)

Oops, think my rock hit a nerve.

But no, no, you're probably right. Bad rock throwing Monkey! I'll just trawl through the thread again for your post that advises everyone that it's time to sell out cause we've hit a peak, I must've missed it, I mean if you're gonna be the 'lead dog' and all...……….. actually, truth be told, I'm a little pressed for time. Which post number was that again? I'm assuming it came days or weeks before the actual event, yes?

Beagle

13-12-2018, 04:32 PM

macduffy

13-12-2018, 04:46 PM

garfy

13-12-2018, 04:54 PM

I haven't enjoyed looking up the daily 'score' so much of late....... Some of my 'better' choices have stopped performing. BUT, they were my choices! I have really appreciated the comments from more experienced Sharetraders - I think about the 'words of wisdom' that are offered, whether positive or negative, and do a bit of 'in depth study'(I call it research) and make my decisions .... But nobody but me makes them. I deal through Direct Broking, and have always 'flown solo'. And I really thank more mature operators - Beagle, Couta, Balance..... to mention but a few, for their comments and insight - sadly their advice often comes to late for me but.... when I look at the score sheet I have had some very helpful advice.
If you are bleeding at present then look in the mirror...... there is always that balance between Greed and Fear....... But do not blame anyone else.

iceman

13-12-2018, 05:17 PM

I think it would be quite interesting to hear from the people that often seem to sell at the top (not referrirng to any particular poster), what they do with their money. If they said "I sold this and did this with my money",I'd be more interested and we would get a better comparison a few weeks or months down the track.

bull....

13-12-2018, 05:46 PM

Maverick

13-12-2018, 07:10 PM

Oops, think my rock hit a nerve.

But no, no, you're probably right. Bad rock throwing Monkey! I'll just trawl through the thread again for your post that advises everyone that it's time to sell out cause we've hit a peak, I must've missed it, I mean if you're gonna be the 'lead dog' and all...……….. actually, truth be told, I'm a little pressed for time. Which post number was that again? I'm assuming it came days or weeks before the actual event, yes?

I`ll stick my head up over the parapet in Beagles defense, not that he needs it.

It's pretty rich of you to start publicly bagging someone for your current pain using only the parts that suit your story. There are sufficient posts saying that the, once strong advocates, of HLG are selling. To save you time, not that I think you will bother, here are but a few.
#2549, #2550,#2555,#2563 - look around August 2018. Beagle is pretty clear he is getting nervous about the heady share price.

This behaviour should stay on hot copper , everyone in love on the way up and the same people at each other's throats on the way down.

Beagle

13-12-2018, 08:36 PM

I`ll stick my head up over the parapet in Beagles defense, not that he needs it.

It's pretty rich of you to start publicly bagging someone for your current pain using only the parts that suit your story. There are sufficient posts saying that the, once strong advocates, of HLG are selling. To save you time, not that I think you will bother, here are but a few.
#2549, #2550,#2555,#2563 - look around August 2018. Beagle is pretty clear he is getting nervous about the heady share price.

This behaviour should stay on hot copper , everyone in love on the way up and the same people at each other's throats on the way down.

Thanks mate and congrats to you for picking the absolute top around $6.30 !
Yeah as far back as early August in post #2440 I made it clear at $5.50 that I thought the shares were fully priced, hence the reason I sold half. Plenty of others like you were also questioning whether it had run out of steam in the late $5s and early $6 range.

I think people (especially those that hardly ever contribute) should be very grateful that some experienced investors like you and I and others take the time to share their research and thoughts. Post #2549 was especially for a friend of mine with a very large holding but also for others. I am very disappointed for him that he didn't take more notice especially after I know he followed me in at the bottom. Your post #2555, also very clear. Maybe the newbies are waiting for us to part the Red Sea as a sign that things have changed and its time to get out lol

Now..getting back to business and looking for the next opportunity.... seeing as you're obviously an absolute legend when it comes to picking the top, can you please tell me if OCA at $1.10 has bottomed out ? :)

percy

13-12-2018, 08:50 PM

Maybe the AOG weakness in Australia is rubbing off on OCA,similar to AHG's rubbing off on TRA.......................lol.

Leftfield

14-12-2018, 08:07 AM

thestg

14-12-2018, 08:29 AM

I barked very clearly it was a buy at $2.70 and also very clearly that it was full and fair value at $5.50 just over two years later and yet some people want to call me a bad dog...go figure...

Thanks Beagle, I followed your advice and was very happy with my large return over the last 2 years. Unfortunately over the last few weeks I ignored my stop-loss & didn't sell till 2 days ago at $4.08, but still very happy with my returns.
I'll be sitting on my profits and hoping the price goes down to the mid $3 over the next few months and then I'll think about buying back in again.
:D

bull....

14-12-2018, 08:43 AM

Beagle

14-12-2018, 08:56 AM

Thanks Beagle, I followed your advice and was very happy with my large return over the last 2 years. Unfortunately over the last few weeks I ignored my stop-loss & didn't sell till 2 days ago at $4.08, but still very happy with my returns.
I'll be sitting on my profits and hoping the price goes down to the mid $3 over the next few months and then I'll think about buying back in again.
:D

You're most welcome mate and I'll probably be there with you buying in the mid 3's :)

if you read thru the thread it was actually maverick who deserves credit for calling the top. $6 was way over brought on technicals and fundamentals and maverick picked that up before any other posters beagle included.
Yes he did. I was the lead dog and called full value first at $5.50 in early August 18 but barked a bit early. (You can't be dead right every time but I did call HBL bang on the money to the exact cent at $2.14 almost a year to this day exactly as being well overpriced despite a chorus on here saying it was worth $2.50.) $6.30 was well and truly overbought, Maverick very astutely recognised this and deserves full credit for picking the peak of the mountain perfectly.

winner69

14-12-2018, 09:00 AM

Hopefully maverick will now tell us the bottom ......

Beagle

14-12-2018, 09:01 AM

Hopefully maverick will now tell us the bottom ......

One thing you can be sure of, I'll have an opinion on where the bottom is in due course and bark about it :)

Arbroath

14-12-2018, 09:11 AM

if you read thru the thread it was actually maverick who deserves credit for calling the top. $6 was way over brought on technicals and fundamentals and maverick picked that up before any other posters beagle included.

Bull - I sold out between $5.40-$6.00 and informed the forum at the time so will claim some credit for the "skewed risk/reward" I noted at the time which time has vindicated...

winner69

14-12-2018, 09:14 AM

Bull - I sold out between $5.40-$6.00 and informed the forum at the time so will claim some credit for the "skewed risk/reward" I noted at the time which time has vindicated...

Couta told me off when I said I’d sold

bull....

14-12-2018, 09:34 AM

Bull - I sold out between $5.40-$6.00 and informed the forum at the time so will claim some credit for the "skewed risk/reward" I noted at the time which time has vindicated...

actually you did too, sorry congrats well done. just goes too show people should value every ones comments and then make there own decisions

couta1

14-12-2018, 09:53 AM

Couta told me off when I said I’d sold I haven't sold any of my core holding for a year now and have no intention of selling any going forward, there are two kinds of smart money(smart trading money as many are currently discussing) and then there's smart old money(That's the massive dividend collecting money) which makes up majority of the biggest holders of this stock.PS-Gragher fits into the first category.

Beagle

14-12-2018, 10:20 AM

actually you did too, sorry congrats well done. just goes too show people should value every ones comments and then make there own decisions

Couldn't agree more. Its when people start expecting others to part the Red Sea for them to escape the Egyptians, (so too speak) that they need to take a very long introspective look in the mirror and ask themselves how much DYOR they have done.

see weed

14-12-2018, 10:48 AM

Sold my last lot of HLG back in May. Sold a bit early but was happy with a bit over $100k div and profit for that financial year on HLG. Had an overall tax bill on all share trading of about $62k in Feb, but in March got that bill down to $11k through loss to div. transfer. Anyone want to learn how to do it, then you could shout me a beer somewhere, and I can tell you how to do it;).

bull....

14-12-2018, 10:56 AM

winner69

14-12-2018, 10:57 AM

moka

14-12-2018, 11:25 AM

Well, that's a wrap folks! Another outstanding performance!

Thanks for taking the time to research and post Ghost Money, I often note the enthusiastic comments saying or implying a stock is a long term hold and then suddenly it’s sold and it’s a dog - AIR comes to mind. Couta1 seems to do long term hold and often rides the waves into the red.
I really appreciate those who take the time and effort to post and share their thoughts with a “this is what I’m doing with this stock, or this is what I think.”
Some posts cross the line though because they imply that this is what you (others) should be doing and if you’re not you’re wrong.
The frequency and intensity of the comments matters. People who hold strong opinions do tend to influence other people. Repetition makes a fact seem more true, regardless of whether it is or not.
I take responsibility for my own decisions and my decisions are also influenced by many posters on this forum. That is why I read the comments to see what other people think. It is good to have diversity of opinions and discussions like this without it getting too personal, without people being offended and no longer posting.

Ghost Monkey

14-12-2018, 09:03 PM

I posted some time back that $5.50 was full and fair value and that I'd sold half, and again very recently... be a good chap and try and keep up. (Very convenient that you've run out of time now after being such a mischievous monkey) Sorry I don't have more time to reply to your mischief.

Your rock throwing sure did miss the point..... the point in all investing is to take responsibility for your own decisions.

The least you can do to be somewhat fair is to date those posts but in response I would simply say welcome to the real world mate where things change. The smart money realises this and does something about it and yes doubling your money plus many outstanding dividends in two years is a truly outstanding performance (of which anyone who followed this lead dog should be extremely pleased and grateful for the barking).

I guess you could do a monkey or possum and stare into the headlights and wonder what hit you and afterwards vent your frustration...doesn't require as much effort that way does it. I guess monkey's can throw rocks but they're not so good at sniffing out a feed eh :)

I barked very clearly it was a buy at $2.70 and also very clearly that it was full and fair value at $5.50 just over two years later and yet some people want to call me a bad dog...go figure...

Ok, well, a bit of venom directed at me. No problem. Takes more than that to knock the monkey from his tree.

Firstly, no need to jump to conclusions about my investing. I'll be up front. I have a total of 700 HLG shares. Yes, you read that right. 700. I had a couple grand sitting in my account a year back and chucked it in HLG for the dividend as it wasn't doing too much in the bank. I'm not losing sleep over this, trust me. I'm a small fish investor, granted, but this was just a bit of spare change I wasn't sure what to do with at the time.

But you made one good point above. I should've dated those posts. Sorry. They were from about April this year. But no problem I'm gonna go one better. And we don't have to go back that far either. Cause your post directly above, really? Really Mr. Beagle?

Ok, well, let's roll with it then....

couta1

14-12-2018, 09:28 PM

Looking forward to my XXOS divvy hitting the bank account on Monday, could buy some nice material item but yeah nah it will all be going into the market. Might buy some more of these gems once Gragher start selling again or more of my favourite play and hold milky share.

Ghost Monkey

14-12-2018, 09:37 PM

I couldn't agree more. Timing of that dividend as well as its size makes it extra sweet. Only really paying about ~ $5 theoretical ex divvy price at the current level which I think is fundamentally very sound buying. I topped up last week...a bit early and at a bit higher than the current price but I think I am now well positioned :)

So here we are. Nov. 22 2018. "Sound buying" "Topped up last week"

A fact completely overlooked by Gaynor. HLG has a stellar record as a dividend yield stock and anyone fortunate enough to follow the dog who picked the bottom a couple of years ago at $2.70 has done handsomely well with capital gains too. Quite apart from that I think they're just coming into their stride with their Glassons expansion in Australia. Plenty more growth to come over there :D I also think its notable that HLG are N.Z.'s oldest listed company. Plenty of companies come and go over the years...there's something I really like about long established companies.

Dec. 2 2018 "Plenty more growth to come" We really like "long established companies". Yeah, me too.

Sticking with my own nose for value, (a Beagle always follows his nose). I think they've finally cracked the Australian retail nut with their new Glassons euro style stores in Australia and there's a very sound case for continuing to hold. The naysayers were all over this when I was buying at $2.70 telling retail was dead ad nauseum. They were wrong then and they're wrong now.

Dec. 3 2018 Those dirty "naysayers" eh, "wrong then and they're wrong now." It's gotta be a great buy still, right?

But wait, what is this??????

This old dog quite a while back reckoned about $5.50 was fair value and sold down half. Anything over that was really on the back of the new Australian institution paying up to get a decent stake, (initial bout of irrational exuberance ?), so settling back to around my fair assessed value doesn't surprise me.

You've sold!!! Half??? What? When? Why?

This monkey is bewildered!

Just that morning you posted about the "naysayers" being wrong. But apparently you've already started selling down? And "a while back" no less!!

Sure, Dec. 3 was a trading update, and it wasn't great. Wasn't quite the end of the world either.

What on earth is going on?

And here folks, is my issue. Mr Beagle, you responded to me yesterday and said, and I quote "anyone who followed this lead dog should be extremely pleased and grateful for the barking". Indeed. So you clearly understand you carry some weight on this forum, and investors should be grateful for following your "lead". But nowhere between you topping up on Nov.22 and announcing you'd sold half your shares on Dec. 3 did you post your intentions to your 'pack' that now was the time to sell. You didn't bark that part did you. In fact, you continued to ramp it up. Ramped it up and sold the story, one you obviously didn't believe any more. And now we have to read about you patting yourself on the back for a job well done, and how we should all be grateful?

So, for all the mum & dad investors, those new to investing, those trying to learn a little bit more, here's the moral of the story:

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

Baa_Baa

14-12-2018, 10:01 PM

So here we are. Nov. 22 2018. "Sound buying" "Topped up last week"

Dec. 2 2018 "Plenty more growth to come" We really like "long established companies". Yeah, me too.

Dec. 3 2018 Those dirty "naysayers" eh, "wrong then and they're wrong now." It's gotta be a great buy still, right?

But wait, what is this??????

You've sold!!! Half??? What? When? Why?

This monkey is bewildered!

Just that morning you posted about the "naysayers" being wrong. But apparently you've already started selling down? And "a while back" no less!!

Sure, Dec. 3 was a trading update, and it wasn't great. Wasn't quite the end of the world either.

What on earth is going on?

And here folks, is my issue. Mr Beagle, you responded to me yesterday and said, and I quote "anyone who followed this lead dog should be extremely pleased and grateful for the barking". Indeed. So you clearly understand you carry some weight on this forum, and investors should be grateful for following your "lead". But nowhere between you topping up on Nov.22 and announcing you'd sold half your shares on Dec. 3 did you post your intentions to your 'pack' that now was the time to sell. You didn't bark that part did you. In fact, you continued to ramp it up. Ramped it up and sold the story, one you obviously didn't believe any more. And now we have to read about you patting yourself on the back for a job well done, and how we should all be grateful?

So, for all the mum & dad investors, those new to investing, those trying to learn a little bit more, here's the moral of the story:

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

Sorry to hear about your dog dying, it's so sad when a canine member of the family passed on.

RupertBear

14-12-2018, 10:11 PM

So here we are. Nov. 22 2018. "Sound buying" "Topped up last week"

Dec. 2 2018 "Plenty more growth to come" We really like "long established companies". Yeah, me too.

Dec. 3 2018 Those dirty "naysayers" eh, "wrong then and they're wrong now." It's gotta be a great buy still, right?

But wait, what is this??????

You've sold!!! Half??? What? When? Why?

This monkey is bewildered!

Just that morning you posted about the "naysayers" being wrong. But apparently you've already started selling down? And "a while back" no less!!

Sure, Dec. 3 was a trading update, and it wasn't great. Wasn't quite the end of the world either.

What on earth is going on?

And here folks, is my issue. Mr Beagle, you responded to me yesterday and said, and I quote "anyone who followed this lead dog should be extremely pleased and grateful for the barking". Indeed. So you clearly understand you carry some weight on this forum, and investors should be grateful for following your "lead". But nowhere between you topping up on Nov.22 and announcing you'd sold half your shares on Dec. 3 did you post your intentions to your 'pack' that now was the time to sell. You didn't bark that part did you. In fact, you continued to ramp it up. Ramped it up and sold the story, one you obviously didn't believe any more. And now we have to read about you patting yourself on the back for a job well done, and how we should all be grateful?

So, for all the mum & dad investors, those new to investing, those trying to learn a little bit more, here's the moral of the story:

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

Seriously have you nothing better to do than troll through old posts to garner ammunition to run down Mr Beagle?! I for one value his posts, he has bent over backwards to help newbies like me and I am grateful he takes the time to post his thoughts on here because he doesnt have to. I am actually very interested to hear what he holds and why and what he sells and why, it doesnt mean I will rush out and buy or sell a share soley based on his opinion. Give the man a break and give the rest of us some credit for our ability to make our own decisions. If you cant abide the man, which is the impression you give, dont read his posts!

My sympathy to you for loosing your dog, its heartbreaking when our furry mates die.

Beagle

15-12-2018, 09:49 AM

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

In the spirit of the Christmas season I also wish to share my condolences. Its extremely difficult to lose a much loved family member especially an adorable Beagle that one and one's family has grown up with. You were fortunate to have 16 years with such an adorable dog. We had Kelly for 11.5 years and the kids and I adored her but sadly she got inoperable cancer fairly early on and it broke our hearts. We have 2 Sydney Silky terriers now and they are getting on towards 13 years old so I need to store food away for the pending vet bills !

I can confirm that Beagle's love their food, in fact they're obsessed with it. I can't be bothered responding to the rest of your post but have a think about this.
Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ? Beagle's are wonderful and loyal dog's and will bark about the first sign of trouble but ask them to let other monkey's eat first out of their food bowl...you must be kidding lol

winner69

15-12-2018, 10:44 AM

My cat died the other day

In his wemory I will remain 'An Awesome Cool Cat' as per my profile

And Monkey my sympathies as well, I know how it feels as we lost a dog a month or so ago as well

Raz

15-12-2018, 10:59 AM

In the spirit of the Christmas season I also wish to share my condolences. Its extremely difficult to lose a much loved family member especially an adorable Beagle that one and one's family has grown up with. You were fortunate to have 16 years with such an adorable dog. We had Kelly for 11.5 years and the kids and I adored her but sadly she got inoperable cancer fairly early on and it broke our hearts. We have 2 Sydney Silky terriers now and they are getting on towards 13 years old so I need to store food away for the pending vet bills !

I can confirm that Beagle's love their food, in fact they're obsessed with it. I can't be bothered responding to the rest of your post but have a think about this.
Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ? Beagle's are wonderful and loyal dog's and will bark about the first sign of trouble but ask them to let other monkey's eat first out of their food bowl...you must be kidding lol

I'm going to defend Beagle on this one, we are all adults and you assess tips, information and DYOR, especially when getting in & out. I really did not follow this share and Beagle did put forward a number of good sound arguments on this share, based on his heads up on this forum and my additional research.. purchased a while back on the run up. I also decided when to start to selling down a xoxo holding. Liquidity on this share is tricky and even though it has been mentioned here countless times..you really don't appreciate how tricky until you actually try to sell down. Thanks to his research and my follow up action it has been a rather drama free gain, just taken more time to cash up than I ever appreciated for a substantial six figure gain. I owe him a beer when ever we finally catch up however perhaps I should be paying for his new car. I appreciate the comments from all, it up to me as an adult to assess them.

Full disclosure: I never met Beagle and its fair to say we see a number of things differently and that is okay, we also have one common interest and that is cars.

Beagle

15-12-2018, 12:05 PM

Thanks mate. I can send you the dealers bank account for the $20K change-over if you like :D

winner69

15-12-2018, 02:08 PM

Maybe there’s been an over reaction to HLG comments.

All we’ve heard is the market is ‘challenging’ and a hint that ‘margins may be under pressure’

What eventuates I have no idea. All I know is that -

Last year’s npat was $27m
Each 2% increase in sales F19 increases npat ~$2.5m
Each 2% point drop in margin adversely impacts npat F19 by ~$4m
If expenses go up 3% that adversely impacts npat F19 by ~$3m

It’s a bit of mix and match to get an estimate npat for F19

An optimist might say relatively modest 4% sales increase and only 1% margin contraction and increased expenses to give ~$27m about the same as last year ...bloody good eh

The pessimist (maybe market view) is no sales growth with a 3% msrgin contraction and 3% expense increase giving ~$18m npat in F19 ..ouch

My view ...this year not too bad but F20 will be a real struggle.

numbers done in my head but I think they are about spot on

Ghost Monkey

15-12-2018, 02:32 PM

Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ?

Of course not. But you've just been caught out talking up a stock whilst you were selling. Does that bother me? Yep. There's a certain moral compass that doesn't appear to be working here.

But is this that unusual? Nope. You're not alone, you're not the first, and you're not the last. I had a friend who ran a team of 4 share traders at one of the world's largest investment banks, in one of the world's largest economies. When he told me that they could actively chart rumours on chat forums affecting share prices and 'exploit' them I realised with dismay that the odds are forever not in your favour, esp if you're small fish like me.

I think I might leave it here. You are welcome to have the last say and feeling free to take some digs. But you obviously missed that my post on Thursday was my own brand of sarcastic humour. But you came out swinging so I swung back. You're a better investor, I don't deny it, and I do read your posts. But I'm also reading through your posts.

And Winner, my own condolences for your dog and your cat. Right before Christmas too, that's not easy.

Beagle

15-12-2018, 05:33 PM

Its kind of ironic...I only ever bought for the dividend a couple of years ago. Classic dividend hounds stock I told myself with only a very modest chance of going up much. I never expected them to double in just on 2 years. Funny how things pan out sometimes isn't it. Happy to hold half...I think they're just starting a really great expansion of Glassons in Australia and expect a very solid performance from this company going forward.

Maybe there’s been an over reaction to HLG comments.

All we’ve heard is the market is ‘challenging’ and a hint that ‘margins may be under pressure’

What eventuates I have no idea. All I know is that -

Last year’s npat was $27m
Each 2% increase in sales F19 increases npat ~$2.5m
Each 2% point drop in margin adversely impacts npat F19 by ~$4m
If expenses go up 3% that adversely impacts npat F19 by ~$3m

It’s a bit of mix and match to get an estimate npat for F19

An optimist might say relatively modest 4% sales increase and only 1% margin contraction and increased expenses to give ~$27m about the same as last year ...bloody good eh

The pessimist (maybe market view) is no sales growth with a 3% msrgin contraction and 3% expense increase giving ~$18m npat in F19 ..ouch

My view ...this year not too bad but F20 will be a real struggle.

numbers done in my head but I think they are about spot on

I posted my thoughts on profit earlier this week mate. Currency was under quite a bit of pressure a few months back which is when they probably bought their summer stock. Annual report detailed margin pressure both in the Chairman's and CEO's report and it was mentioned again at the annual meeting so its more than a hint.

Ghost Monkey - I'm not going to get into an argument with you other than to say this. I have made over 11,000 posts and I call things as I see them at the time. I sold half in early August 2018, please see my post above. Things happened so quickly with HLG on the way down I was too busy trying to exit for a good price to post my updated thoughts. I have shared my forecast for 2019 and its up to people to make their own assessment of where they see fair value for HLG now.

If you are interested my top pick and #1 listed investment position for 2019, is OCA and I believe the current price represents a truly compelling investment proposition...just as compelling at $1.10 -$1.11 as when HLG were $2.70. I rate OCA a VERY STRONG BUY - is that clear enough for you ?

winner69

15-12-2018, 06:01 PM

I posted my thoughts on profit earlier this week mate. Currency was under quite a bit of pressure a few months back which is when they probably bought their summer stock. Annual report detailed margin pressure both in the Chairman's and CEO's report and it was mentioned again at the annual meeting so its more than a hint.

Ghost Monkey - I'm not going to get into an argument with you other than to say this. I have made over 11,000 posts and I call things as I see them at the time. I sold half in early August 2018, please see my post above. Things happened so quickly with HLG on the way down I was too busy trying to exit for a good price to post my updated thoughts. I have shared my forecast for 2019 and its up to people to make their own assessment of where they see fair value for HLG

So this margin pressure could be more severe than I estimated ...maybe a more pessimistic case than above is worth looking at

Say no sales growth, a 4% points margin contraction and 3% increase in overheads - that would result in npat F19 being $11m/$12m less than last year .. about $15m

Nah, won’t happen ...will it?

Beagle

15-12-2018, 06:42 PM

So this margin pressure could be more severe than I estimated ...maybe a more pessimistic case than above is worth looking at

Say no sales growth, a 4% points margin contraction and 3% increase in overheads - that would result in npat F19 being $11m/$12m less than last year .. about $15m

Nah, won’t happen ...will it?

Probably not. I am thinking 58% gross profit margin, expenses up 1-2% and sales up 3% which gets me to about $20 - $23m after tax but its very early days and a lot depends upon the gross profit margin and yes absolutely, they have mentioned its under pressure several times now. Probably just as well we didn't go down or stay down at 62 cents US. $21.5m on 59.6m shares gives eps of 36 cps. Choose whatever PE you think is right...

winner69

16-12-2018, 08:44 AM

Last couple announcements been a bit miserable haven’t they, I hadn’t really tried to read between the lines until yesterday.

Their updates usually are of a more general nature but the Chairman’s little bit about F19 outlook was pretty detailed for them (like mentioning fuel, electricity etc)

Maybe margins aren’t only being affected by the lower NZD and AUD but also from competitive forces — that’s might ‘challenging market conditions’ do to you.

If that is the case the 58% gross margin some of you are thinking might be a bit optimistic. Remember that each 1% point of margin impacts npat by ~$2m.

I also get the impression that keeping expenses down are a bit of a problem, especially the cost of running an ever increasing number of stores. They mentioned electricity for instance, but no mention of wages which is interesting. I think Beagle is forecasting expenses to be up 1% to 2% which I reckon is a bit light ...maybe needs to ask Mrs Beagle what’s the cost of living like.

But then we don’t know how good or bad things are until February but I reckon it’s likely there’s more bad stuff than good stuff to come.

Is that how Grahger read it .....they spent big when things looked good but changed their minds pretty fast for an outfit not renowned for short term punting

Beagle

16-12-2018, 12:09 PM

Good post Winner and I think you have made some very pertinent points.
Yes absolutely the risk to that gross profit margin is to the downside and will depend upon the level of discounting as the season goes on. Maybe 56-57% is more realistic especially as the exchange rate was quite a long way below the multi year channel of 68-74 cents US (of previous years) when they would have been buying their summer stock. Also thinking about your post above and looking at the number of new stores again and thinking about mall rents, electricity costs in Australia which can be horrendous and wage cost pressure.. I think I do need to have another look at my modelling there so here we go...

Store numbers - as per CEO's address at last years 2017 annual meeting 123 of which 10 were Storm so normalising this there was a total footprint as at December 2017 of 113 stores of which 44 were Hallensteins N.Z. and 3 in Australia and there was 28 Glassons Australia stores and 38 in N.Z.

Comparing that to this years totals as at the date of the very recently held annual meeting there are now
42 Hallensteins stores in N.Z. and 3 in Australia (after they closed 2 small non performing Haldenstein's stores during FY18) and there remains 3 in Australia
37 Glassons N.Z. stores after they closed one non performing store in Henderson Auckland during FY18
32 Glassons Australia stores after they opened 2 new ones during FY18 and a further 2 since balance date
Total store footprint as at December 2018 is 114.

Footprint expansion in percentage terms 114/113 = 0.88%.
If we assume staff costs, rent and electricity is up by 2% then it would appear you are right Winner than we could be looking at an expense ratio increase in the order of 3% taking into account the slightly expanded store footprint.
If we assume that and we assume a gross profit ratio of just 57% then you may be right and we could be headed for NPAT of somewhat less than $20m.

Sticking with my forecast of $20 - $23m at this stage but there are clear risks to the downside so I will revise in due course when more data is known.

winner69

16-12-2018, 12:40 PM

Yes Beagle F19 result more dependent on margins and expense control than usual. Can’t rely on sales growth ...each 1% increase in sales only generates ~$1.1m incremental npat.

A fair percentage of the expense based is of a fixed nature but could always cut back on marketing spend to keep profit up .....but that’s not always a good strategy eh

Beagle

16-12-2018, 12:50 PM

Sales growth is 4% (Is that 4 point something percent or 4.0 percent down from 4.8% earlier this month ?) but normalised sales growth for exit of storm brand is up close to 6%, (or was the 4% sales growth already normalised by the company for the sale of the Storm brand ?) on less than a 1% increased retail footprint or is the retail footprint slightly bigger because they did mention that the 2 Hallensteins Kiwi stores that were closed during FY18 were small and new Glassons store openings in Australia could be large footprint ?). Quite a bit of detail we don't really know here. Earlier this week I made the mistake of thinking same store sales growth was negative. Now having more time to look into this it doesn't look too bad. Sticking with $20 - $23m. Mid point $21.5m is 36 cps so I am sticking with that until there's more colour on how things are going this year.

Maverick

16-12-2018, 04:05 PM

After being inspired by the maths being discussed between Winner and Beagle, I thought I`d better not be so lazy and look up my own spreadsheets to asses the latest result.

For the last 5 years up to FY2017 the overall margin (FY total sales divided by NPAT) has constantly ranged around an average of 7.4 %.
There was stand out bad year 2016 when it was 6.1%... bad exchange rate , bad weather and missing a CEO.

However in FY 2018, things changed. The first 6 months, margins skyrocketed to 10.3%, then the second half year fell to 9.4%
The stunning 10.3% was unprecedented. My notes of the time all made reference to just how hot it was.
The following 9.4 % during winter was a more regular winter weather, but even so it was still the second best result on record for HLG.

My interpretation is that 2 things happening FY2018.
1. It was a crazy hot summer which produced an unprecedented financial result.
2. The average winter conditions still produced a result way above par, I believe this is from a combination of improvements HLG have made.

My own conclusion is that while HLG was boosted by a one off weather pattern, HLG has systemically improved itself.
I personally expect an average NPAT margin of 9.4% of net sales, going forward as the standard. (to that base rate I`ll make adjustments to allow for currency, weather and missing CEO`s).

HLG has said it is too early to predict this seasons trading. Given the summer has only just started I also think it is too early go all a mathematical at this stage. That being said, with what we know in the infancy of this year can't see why HLG isn't going to make $23-$24 million NPAT but things WILL change.

I`ll be looking for the, exchange rate, weather conditions and mostly the timing of the discounting racks going out ... well I`ll be asking Meg Ryan at least.

Beagle

16-12-2018, 04:25 PM

Really appreciate you having a go, much better than some monkey throwing rocks. Its very hot today so maybe after a refreshing beverage or two you might have done a typo when crunching your numbers so maybe have another look mate.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/326026/289507.pdf
Last year they made $27.36m NPAT on $277.64m sales = 9.85 % net profit margin on sales but on very strong currency and as you observed a really sizzling summer this time last year.

Even removing the loss making Storm brand from the comparison I think with the quite significantly lower currency this year and increased store footprint and related costs they might struggle to get to their 5 year average of 7.4% (mainly because of the very tough currency earlier this year when they were buying their summer stock) which on say $285m (which is a 3% increase, I have used 3% as sales growth momentum appears to be slowing) gives $285 x 7.4% = $21m which is around the mid point of where I see it. This gives about 36 cps on 59.6m shares.

What is the right PE for where things are at for where we appear to be in the cycle ?....that's a very very difficult question. Pretty sure you meant to say $4.80 which is a forward PE of 13.3 on 36 cps. Seems a bit high to me.

Winner do you have any data on the average PE of HLG over the years ? My gut feel is this is in the range of 10-11.

Maverick

16-12-2018, 04:47 PM

Ta Beagle,
good spotting, your right onto it as usual. But i'd picked it up moments after posting so all fixed up now. (jotted down the wrong cells)

As far as the down currency trend was, that things moves all the time so it's just as likely to be working in the positive in six months time, so i don't rate its effect medium term too much.

I do really think the business has got itself functioning well though. Apart from any new competition biting the pie I see no reason for it to slump back to where it came from a few years ago. Right now I see it worth about $4.80-$5.20 but theirs no chance of that if Aussie guys keep selling.

As far as competition goes, I was a little concerned about "Cotton on" but their stores have a seriously chaotic feel.

winner69

16-12-2018, 05:10 PM

Beagle - over the years HLG PE ratio has been between 11 and 12. This is over June/Aug period on actual full year results at the time (ie not on forecast earnings). In the context of your 36 cents eps for F19 that would mean a share price of 400/430 next July.

I’ve posted an updated share price v eps over the years chart. You can see most times the share price is around that 11/12 times eps ...but the share price overshoots big time on the upside eh (not the time to be buying HLG shares eh)

Beagle

16-12-2018, 05:27 PM

Good skills Maverick and good to look at the shares a different way (your net profit to gross sales method). Not sure I agree with your conclusions about 9.4% net profit to gross sales ratio going forward but yes its well worth acknowledging they have made significant increases in the percentage of digital sales in very recent times and their digital footprint is smoking hot :t_up:

Definitely a winning strategy to only buy on the big dips eh Winner :) Shares are currently about the average that Graghar paid aren't they ? Maybe they just keep selling on the drip whenever there is buying, (which would probably take many many months) and the price is currently effectively capped and can only really go one way from here or best case scenario stay the same ?

winner69

16-12-2018, 05:34 PM

I’m still a bit puzzled or wary why Grahger sold down so soon after buying in.

Not really known for being short term holders .....something has spooked them

The ‘Johnny Come Lately” would know a lot about Australia fashion retailing I reckon ...maybe Australia is where the real ‘challenges’ for HLG are.

Beagle

16-12-2018, 05:39 PM

Severe housing correction in Sydney and Melbourne and rapidly declining prices a trend that seems firmly entrenched...must be pretty toxic to consumer confidence eh ?
Last week ASB economists opined that the chances of Auckland realty following Sydney down is pretty good and provided evidence supporting their analysis. Is Auckland real estate and consumer confidence deterioration the next big shoe to drop ?

I suspect Grahger are acutely aware of how things are going in a retail sense in Australia. HLG directors and CEO at pains to emphasize challenging retail conditions for many months now and sales growth is declining so it appears to be getting more challenging. Didn't you say they had sold out of LOV as well ?
P.S. Just had a look at the chart of LOV on the ASX and that also looks very ugly. Hope we don't get a recession next year as then discretionary retail sales will really tank.

winner69

16-12-2018, 05:59 PM

Re Australia Housing I found this an interesting insight -

Melbourne & Sydney house prices currently undergoing the largest fall since 1992. For an 80% service based economy with close to 40% part time workforce with record household debt, the unprecedented run is on the clock.

I would hazard a guess that those that could be affected as above are the type of customers HLG are interested in. Not good for them.

Auckland is a serviced based economy as well and there easily be an ‘unprecedented run’ in Auckland (and other places)

couta1

16-12-2018, 06:10 PM

A lot of speculation and guess work going on on here, I'm happy just to wait until Feb to find out the truth from the horses mouth.PS-The sooner Gragher gone the better.Lol

Beagle

16-12-2018, 06:33 PM

A lot of speculation and guess work going on on here, I'm happy just to wait until Feb to find out the truth from the horses mouth.PS-The sooner Gragher gone the better.Lol

I'm always trying to look around the next corner coming up but yeah, not long to wait. Last year they gave a trading update and profit forecast on 3 February. That'll give us the best guide for the full year. Big divvy for you to enjoy paid out tomorrow :)

bull....

16-12-2018, 06:47 PM

beagle and winner must be shorting the stock? very enthused they are in there negatve comments lol

Baa_Baa

16-12-2018, 07:43 PM

Beagle

16-12-2018, 07:53 PM

couta1

16-12-2018, 08:05 PM

HLG is a stomach churning cyclical, all fine if you know how to buy the upcycle getting the capital gains and the dividends, and sell the down cycle avoiding capital losses. Otherwise it's a recipe for nightmares.

10200
Monthly chart Nice Mountain range there Baa_Baa, I guess those that bought in 2001 and just held would have done nicely out of the dividends and would currently be nicely in the green, would have been a real test of endurance in 2009 however.

Snow Leopard

16-12-2018, 08:25 PM

HLG is a stomach churning cyclical, all fine if you know how to buy the upcycle getting the capital gains and the dividends, and sell the down cycle avoiding capital losses. Otherwise it's a recipe for nightmares.

10200
Monthly chart

Beauty of a long term uptrend there - just got to wait for the $2.20 mark and start buying.

Kudos for the log price axis. We will make a chartist of you yet :t_up:

LAC

16-12-2018, 09:02 PM

Hallensteins out east was absolutely packed today! Yesterday morning was just as packed. $29 for jeans I mean that’s a bargain if I say so myself

Baa_Baa

16-12-2018, 09:18 PM

Beauty of a long term uptrend there - just got to wait for the $2.20 mark and start buying.

Kudos for the log price axis. We will make a chartist of you yet :t_up:

14 years here, more before that on Sharechat when it had a discussion group and countless more before that on the old Kitco when Gold was doing it's thing. Finally a compliment from the Snow Leopard, for a Log Axis! Yeah OK, kudos back at ya, you're a patient teacher.

Without any real TA, this is just a simple chart with very long term support and resistance trend lines. Real TAnalysis is not worth posting here, imo, it just provokes a technical discussion that bamboozles the masses and diverts the discussion to a weird place, sometimes wounding the poster and they leave, @Hoop for example (miss him here).

I'll be buying $2.20 as well, if it happens. Probably won't though, the missing support trendline from my chart is 2009 to mid-2016 which suggests a support range around $2.90-$3.20 :)

Still pretty brutal these cyclicals, if you're not acting on market sentiment there can be many months or even years between sleeping well and sleepless nights.

BlackPeter

17-12-2018, 08:23 AM

Hallensteins out east was absolutely packed today! Yesterday morning was just as packed. $29 for jeans I mean that’s a bargain if I say so myself

Just wondering what margin they might have on a $29 jeans? Good for the consumer ... but is it really good for the shareholder?

bull....

17-12-2018, 08:38 AM

HLG is a stomach churning cyclical, all fine if you know how to buy the upcycle getting the capital gains and the dividends, and sell the down cycle avoiding capital losses. Otherwise it's a recipe for nightmares.

10200
Monthly chart

your chart illustrates nicely a wise person would have sold at just under 6 based on past behaviour.

bull....

17-12-2018, 08:40 AM

A lot of speculation and guess work going on on here, I'm happy just to wait until Feb to find out the truth from the horses mouth.PS-The sooner Gragher gone the better.Lol

couta heres a link for you your now be able to follow your gdp data , retail sales in real time. by the way im picking a good xmas sales season in nz , not sure about aus

http://www.gdplive.net/Dashboard

couta1

17-12-2018, 09:21 AM

LAC

17-12-2018, 09:32 AM

Just wondering what margin they might have on a $29 jeans? Good for the consumer ... but is it really good for the shareholder?

Not sure on jeans but I do know the markup on men's T-shirts and women's sleepwear as I have some products being manufactured at the same manufacturer and trust me it is insane the markup on them. Their deadlines and logistics is top notch compared to my process. Wont publish that info on here though:) If jeans are anything of the same margins I am sure it will be fine at those discount prices as well.

couta1

17-12-2018, 10:19 AM

Price looks stable at current level with Gragher on holiday, about fair value IMO.

Beagle

17-12-2018, 10:35 AM

Price looks stable at current level with Gragher on holiday, about fair value IMO.

Enjoy that massive dividend arriving today mate :t_up:

couta1

17-12-2018, 10:37 AM

Enjoy that massive dividend arriving today mate :t_up: Sure will, will be buying a bathtub full of A2.

couta1

17-12-2018, 11:13 AM

Enjoy that massive dividend arriving today mate :t_up: She's arrived and she's a biggie.:t_up:

peat

17-12-2018, 11:17 AM

yeh a good divi based on return % (of price paid)
even better at todays prices (over 10% on DB)
some people need returns on capital, without looking to chop and change all the time.

oldtech

17-12-2018, 11:19 AM

Mine is also in the bank, but I suspect I'd have to move the decimal point to the right a couple of places to match couta's ... :scared: Still much appreciated. :t_up:

couta1

17-12-2018, 11:20 AM

Mine is also in the bank, but I suspect I'd have to move the decimal point to the right a couple of places to match couta's ... :scared: Still much appreciated. :t_up: It's all relative and it's all good.

carrom74

17-12-2018, 11:27 AM

couta heres a link for you your now be able to follow your gdp data , retail sales in real time. by the way im picking a good xmas sales season in nz , not sure about aus

http://www.gdplive.net/Dashboard
Thanks Bull.. a real-time dashboard! Wow... this is why I love ST ...so much information sharing from learned investors and it helps all..

Beagle

17-12-2018, 12:10 PM

Maverick

17-12-2018, 12:22 PM

http://www.sharechat.co.nz/article/b96f725c/christmas-shopping-starts-to-take-off.html?utm_medium=email&utm_campaign=Christmas%20shopping%20starts%20to%20 take%20off&utm_content=Christmas%20shopping%20starts%20to%20t ake%20off+CID_7d220164d1fce30739025a52d72f6c58&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticleb96f725cchrist mas-shopping-starts-to-take-offhtml

When that joint credit card bill comes in after Christmas looks like Peat and Maverick should be very afraid :)
"However, the spend-up is highly variable across the country. The biggest increase was by people in Whanganui, up 8.2 percent"

Yep , looking at the last few months credit card statements, I can say Meg Ryan was responsible for at least 2 % of that.
Happy wife , happy life.....:scared:

peat

17-12-2018, 12:30 PM

http://www.sharechat.co.nz/article/b96f725c/christmas-shopping-starts-to-take-off.html?utm_medium=email&utm_campaign=Christmas%20shopping%20starts%20to%20 take%20off&utm_content=Christmas%20shopping%20starts%20to%20t ake%20off+CID_7d220164d1fce30739025a52d72f6c58&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticleb96f725cchrist mas-shopping-starts-to-take-offhtml

When that joint credit card bill comes in after Christmas looks like Peat and Maverick should be very afraid :)
"However, the spend-up is highly variable across the country. The biggest increase was by people in Whanganui, up 8.2 percent"

I wouldn't have thought I was that big a spender as to push around national figures. Haha. That said that guy at Harvey Norman will almost certainly get a bonus this year. Noel Leeming not so much , they always seemed to be one step behind eg they only had the Apple watch series 3 even when the 4 had been out for ages. I havent bought anything at Hallensteins yet either , but when I do the share price should improve. lol

couta1

17-12-2018, 12:34 PM

All our family are buying at Hallensteins/Glassons and only drinking A2 milk now, always support the hands that feed you.

Antipodean

17-12-2018, 12:37 PM

Some more quotes from the sharechat article:

"spending excluding fuel jumping to $1.27 billion in the second week of December, up 6 percent compared with the first week."
“Spending is expected to jump again this week, both relative to last week and in terms of the annual growth rate”
"...over Saturday and Sunday where underlying spending amongst core retail merchants was up 5.5 percent and 4.6 percent respectively on the same days in 2017"

Ties in rather well with the retail, trade and accommodation section of the live gdp forecasting - which looks looks very promising.

Beagle

19-12-2018, 12:27 PM

https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12179428

That's a lot of extra wages for young employees. Some retailers will feel this. But wait three's more. A planned increase of a whopping $1.70 an hour extra from 1 April 2020. http://www.sharechat.co.nz/article/283ffa4d/government-outlines-planned-hikes-in-minimum-wage.html?utm_medium=email&utm_campaign=Government%20outlines%20planned%20hik es%20in%20minimum%20wage&utm_content=Government%20outlines%20planned%20hike s%20in%20minimum%20wage+CID_fda147b527f486083822e5 9aad5d5986&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle283ffa4dgovern ment-outlines-planned-hikes-in-minimum-wagehtml
On the other side of the ledger though, this will put more money in the hands of many young people many of whom are HLG's target market so maybe its a net neutral ?

carrom74

19-12-2018, 08:07 PM

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12179699

Hoping for an upswing with external forces chipping in...

Baa_Baa

19-12-2018, 08:39 PM

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12179699

Hoping for an upswing with external forces chipping in...

All good, but they can't avoid the two-three months of consumer spending that came with last years early and prolonged summer that hasn't happened this year. I reckon they'll have quite a few truckloads of summer stock that hasn't sold yet because summer hasn't arrived, and unless summer does arrives they'll be stuck with massively discounted end-of-summer sales. That'll be obvious even before Christmas, maybe even now.

It's a fickle business and it's been around long enough for the brokers, commentators and punters to know when a bumper season is on us, and when it's not. Currently it's not. That's what makes a cyclical.

Beagle

22-12-2018, 10:04 AM

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12180870
Historical PE off ANZ securities website
WHS 31.4
KMD 8.1
BGR 11.8
HLG 8.9

KMD's PE looks interesting given they are reporting higher same store sales growth than HLG and talking up a significant increase in interim period profitability whereas HLG are talking there's down.
(Could be an interesting punt for 2019 assuming the bear doesn't get really rampant, (as a lot of their sales really are consumer discretionary)

winner69

23-12-2018, 09:43 AM

Paymark says pre-Xmas sales in NZ booming just before Xmas - reckon seasonal spend could be up 5%/6% on last year

Wonder how things are going in Australia — Australia will make or break HLG this year. NZ not that much of an issue.

Brain

23-12-2018, 11:59 AM

If HGL can increase their market share in Aussi which I am expecting them to do (the good retailers that they are ) along with an increase in general retail spending they should do well.

No Worries from this cats point of view.

winner69

24-12-2018, 04:26 PM

Spend up to Christmas not that brilliant ....barely ahead of last year the paymark man says

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12182048

Beagle

24-12-2018, 06:34 PM

Spend up to Christmas not that brilliant ....barely ahead of last year the paymark man says

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12182048

So...spending was up a "whopping" 1 % on last year. Just as well they don't adjust it for the 2% inflation eh otherwise they'd be saying in real inflation adjusted terms spending is down 1% ! Hope HLG sell raincoats and umbrella's and maybe they should stock inflatable boats...(all that's really needed in Auckland the last couple of days and tomorrow), where's summer ? http://www.nzherald.co.nz//nz/news/article.cfm?c_id=1&objectid=12182037&ref=clavis

percy

27-12-2018, 08:15 AM

Headlines in today's papers.
Boxing Day bonanza.
Traffic congestion not only in Mt.Wellington,but around Westfield Riccarton,and Bunnings in Blenheim Road .
I noted a huge que of cars trying to get into Harvey Norman car park in Moorhouse Ave.
So I would expect HGL would have traded well.
Hot days here on Saturday and Sunday should help them move Summer stock.
The sharemarket does not appear to have affected HGL's customers.Will it ever.?

ps.I remember when I started my first retail store,which was a toy shop,there was suppose to be a recession one Christmas.Doom and gloom,however I missed it, as I was too busy to read the newspapers.

winner69

27-12-2018, 08:28 AM

ps.I remember when I started my first retail store,which was a toy shop,there was suppose to be a recession one Christmas.Doom and gloom,however I missed it, as I was too busy to read the newspapers.

Nice one percy

My wife once saw on the TV news there was a recession coming and asked that’s bad isn’t it winner. I said remember 5 to 6 years ago, was that bad ....no .....well that was a recession and you didn’t know about that did you.

Headlines are only noise eh but life goes on.

couta1

27-12-2018, 09:47 AM

Nice one percy

My wife once saw on the TV news there was a recession coming and asked that’s bad isn’t it winner. I said remember 5 to 6 years ago, was that bad ....no .....well that was a recession and you didn’t know about that did you.

Headlines are only noise eh but life goes on. A good thing to remember whilst reading all the doom and gloom articles in the Herald, 90% of it is just garbage.PS-Expecting a good report from HLG in Feb.

winner69

27-12-2018, 10:28 AM

A good thing to remember whilst reading all the doom and gloom articles in the Herald, 90% of it is just garbage.PS-Expecting a good report from HLG in Feb.

Retail sales always seem to go up in NZ as per this chart (Stats NZ info)

Why worry about what happened yesterday or last week

Anyway in HLGs case its not really how much sell ...its the margin they make on it that matters

Beagle

27-12-2018, 10:35 AM

Retail sales always seem to go up in NZ as per this chart (Stats NZ info)

Why worry about what happened yesterday or last week

Anyway in HLGs case its not really how much sell ...its the margin they make on it that matters

They have warned very clearly on the margin on more than one occasion. Also it was crystal clear they were buying their current stocks some time back when the currency was a lot lower. Sound reasons for the SP to retrace but has it found fair value ? Maybe for now ? We'll see in early February how things have gone.

winner69

27-12-2018, 10:40 AM

Tried out the online Boxing Day sale yesterday and got some jeans at $29.99 (normally $69.99 yeah right) and they upsold me to get a tee as well so I get free delivery. Thats cool. Bit mean by saying the 20% of 'your first order' could be applied to sale items ....probably asking too much eh

Jeans prob crap and won't be as good as my neat Hiut ones but will be OK to go for walk along the beach (or even mow the lawn in)

Pretty good online service .... fast and furious and they say they are already on the way. I'd say better than Kathmandu online

iceman

28-12-2018, 11:40 AM

Beagle

28-12-2018, 11:44 AM

According to www.interest.co.nz Kiwi spending on Boxing Day was up 11% compared to 2017. 2.5 million transaction processed on Wednesday valued at $ 140 million. "Spending within the Core Retail sector excluding Food and liquor merchants and excluding Hospitality merchants totaled $73 mln making Boxing Day 2018 the fourth busiest day of the year, surpassed only in the Thursday to Saturday before Christmas and exceeding the $70 mln on Black Friday".

I think this gives us an interesting insight into how Kiwi's are spending now that fuel has returned to more affordable level's or maybe they are just flashing the plastic and loading up on debt ? That said I am not ready to call an end to this correction in HLG's share price because last summer was such a stunner and stock was bought on much better currency terms.

dreamcatcher

30-12-2018, 11:55 AM

Kiwi's know retails SALES DAY calendar so why purchase anything @ full price from now till Feb stock reduced by 20% - 70% ............very common.

Just bought furniture reduced from $1199 to $499 Clothing no exception everything MUST GO !

As winner69 said ITS ALL ABOUT THE MARGIN

BlackPeter

03-01-2019, 03:41 PM

Not the best way to start the New Year - but here we go: Happy New Year to everybody! ... and always remember - money does not make happy!

Quite shocking update today from Kathmandu:

https://www.nzx.com/announcements/329075

Sales below forecast as well as below last year. Sort of wondering how the HLG business was going, given that they are operating in the same markets (AU and NZ)?

Maybe the bear starts to show its teeth ...?

Beagle

03-01-2019, 03:52 PM

Licking my wounds from a fresh bear clawing over KMD today. Not keen for another clawing, mauling or biting so will avoid retail altogether for now. Last time I checked Bears are bigger than Beagle's, just as well I have a safe kennel called cash. Might poke my snout out of the kennel and sniff the breeze if HLG comes down to $3.50.

winner69

03-01-2019, 04:46 PM

Are we talking about recessions or bear markets here?

No recession likely this year in NZ

pg0220

03-01-2019, 05:15 PM

It sounds that the margin pressure is inevitable as they spoke at the AGM. I am hoping that they have still achieved sales growth especially from the aussie market and through the online sales platform. The buy now pay later services provided through layby and afterpay is also a thing to take into account - Kathmandu doesn't have one from their online shop.

Beagle

03-01-2019, 05:25 PM

Are we talking about recessions or bear markets here?

No recession likely this year in NZ

Maybe both, we'll see.

BlackPeter

03-01-2019, 06:31 PM

Are we talking about recessions or bear markets here?

No recession likely this year in NZ

You are right - we need to distinguish between recession and bear markets. Well, the bear has already arrived in many capital markets, and personally I don't think it will pass NZ.

Economic growth (or lack thereof) including consumer spending is a different thing, though somewhat related. People who watch their Kiwi saver accounts and house prices go down might feel less inclined to continue spending as if nothing happened. Companies with slimmer margins (like KMD, Apple and probably HLG) are likely to invest less. I am sure that economic growth will slow down this year, but it may or may not be enough to move into a recession.

Beagle

03-01-2019, 06:40 PM

Official measure of a recession is two consecutive quarters of negative GDP growth, (just posting this for the odd person that may not realize what constitutes an official recession) something that only becomes obvious well and truly after the fact what with the delay in the reserve bank declaring the GDP for two consecutive quarters. Its not officially known about until about 8 months after what has become obvious to retailers for some time. Such a backward looking thing and then there's the nuances of how GDP is calculated. GDP for the Sept quarter was just a 0.3% growth much weaker than many economists expected. December quarter GDP with its very high fuel prices may look okay as demand for fuel is very price inelastic, (consumers had to spend more, on the plastic anyone ?), but the underlying effect of higher fuel prices was to sap consumer confidence.

Pretty clear that consumer and business confidence is very weak and we were lucky on the NZX to escape the bear (viewed on an annual basis) last year. Dig deeper though and I think there's a good case to be made for saying the bear arrived here in October 2018 and has been busy clawing most people's portfolio's since then. Momentum in HLG's sales clearly was lost as the latter part of 2018 played itself out. Risk for retailers other than consumer staples looks to be to the downside to me.

Take care to avoid the worst of the bear.

winner69

03-01-2019, 07:02 PM

You are right - we need to distinguish between recession and bear markets. Well, the bear has already arrived in many capital markets, and personally I don't think it will pass NZ.

Economic growth (or lack thereof) including consumer spending is a different thing, though somewhat related. People who watch their Kiwi saver accounts and house prices go down might feel less inclined to continue spending as if nothing happened. Companies with slimmer margins (like KMD, Apple and probably HLG) are likely to invest less. I am sure that economic growth will slow down this year, but it may or may not be enough to move into a recession.

Our mate Orr will make sure we’ll be OK in the short/medium term....yeah right .....until he realises his dilly dallying around is bound to cause real grief.

Reckon 2020 will be the hard yeah

percy

03-01-2019, 07:32 PM

Our mate Orr will make sure we’ll be OK in the short/medium term....yeah right .....until he realises his dilly dallying around is bound to cause real grief.

Reckon 2020 will be the hard yeah
I think it would pay to get a long way through 2019 before you made a call on 2020.
Lets face it, it only took a day for your's and Beagle's KMD call to be proved wrong....lol.

Beagle

04-01-2019, 12:09 PM

I think it would pay to get a long way through 2019 before you made a call on 2020.
Lets face it, it only took a day for your's and Beagle's KMD call to be proved wrong....lol.

Better to be wrong for a day than to be wrong for years isn't it !

percy

04-01-2019, 12:38 PM

Best not being wrong at all...!!.
But being proved wrong in just a day must be some sort of record,and not a full moon either..!!..lol.
Buffett's record is 6 out of 10.
And he is an investor though. !

Beagle

04-01-2019, 01:08 PM

Best not being wrong at all...!!.Completely unrealistic to think you'll never make an investment mistake and there is widespread surprise and disappointment at KMD's most surprising market update
But being proved wrong in just a day must be some sort of record,and not a full moon either..!!..lol. Quickest entry and exit I can recall ever too but I'd rather take a quick and very small loss on a very small opening position (just 1.2% of my listed portfolio) than keep adding for years in a major way to a losing one like TRA like some people have done, all the while talking up its prospects. Nobody had time to follow the dog on KMD because I bought at the close on 31 December and sold on the open the next business day so nobody lost money following me on that one
Buffett's record is 6 out of 10.Well I'm feeling really chuffed with my record then
And he is an investor though. !There are many investment approaches. Buy and hold forever is not working especially well at the moment. Buffet lost $3.5 billion on Apple in just one day on Wall Street today. Interestingly according to CNBC not one single professional analyst called the major correction in Apple in recent months. I guess being wrong now and again is very much "on trend" at present :)

percy

04-01-2019, 01:13 PM

Yes many ways to skin a cat,and we all should remember many investors have done very well doing it "their way" including Warren Buffett.
TRA remains a high conviction stock for me.My third largest holding,behind HGH and one other..

peat

04-01-2019, 05:59 PM

Buy and hold forever is not working especially well at the moment.
Of course buy and hold is never meant to be evaluated on the 'moment'

But re KMD I tend to think that with trading a quick failure is an acceptable outcome, if not a preferred one. Trading requires playing the percentages and following the parameters on the belief that the odds will pan out in the positive.

winner69

06-01-2019, 12:11 PM

BeeBop

07-01-2019, 07:22 AM

Doubt whether Glassons Australia affected by this outfit who are apparently hurting the encumbents

Uniqlo ups raid on Australian retailers
https://www.smh.com.au/business/companies/uniqlo-ups-raid-on-australian-retailers-20190102-p50p9w.html

Uniqlo is one of my favourite clothing stores. I can buy classic items at fair prices and wear them well in many situations: cashmere, Merino, down, cotton. The stores are always busy wherever I see them in the world.

I did look up the parent company as a potential investment and vaguely remember noting that while the price growth was strong it did seem inflated - one of the fastest growing clothing retailers?

percy

07-01-2019, 08:06 AM

BeeBop

07-01-2019, 11:57 AM

Don't know if this is the right thread.
Brother-in-law's high school daughter, and her friends all brought their leavers' ball gowns on line from the US.Took two weeks to arrive.
All were happy with their purchases.
Saved a great deal of money by doing so.

Retail is changing A LOT....retailers that aren’t dynamic will slowly pass away. One upside that NZ retailers have over the on-line/off-shore is the after-sales service...if those ball gowns don’t fit; how readily are they modified, or, are the gowns sold in a modifiable form? HLG seems to be moving with the times but I am 100% off clothing retail after my UK burn in Bonmarche 2 years ago.

BlackPeter

07-01-2019, 12:34 PM

Retail is changing A LOT....retailers that aren’t dynamic will slowly pass away. One upside that NZ retailers have over the on-line/off-shore is the after-sales service...if those ball gowns don’t fit; how readily are they modified, or, are the gowns sold in a modifiable form? HLG seems to be moving with the times but I am 100% off clothing retail after my UK burn in Bonmarche 2 years ago.

Haven't yet found any retailer in NZ who would do something when their clothes need modification. Best case they tell you the address of the next tailor.

They don't even stock trousers which would fit for me ... my options for a new jeans are only

1) Buy in NZ: Go to a NZ retailer, pay $150 to $200 for a quality jeans (say Lewis), carry the jeans to a tailor, pay $30 to $50 for the necessary modifications and have another trip to the mall at a later day to pick it up. Or - alternatively I can
2) order a fitting jeans (take the same Lewis jeans as above - and yes, I do know my US size) which does not need modifications for something like $100 to $150 (NZ) overseas. In the US they do sell Jeans which fit without the need for modifications. Receive the jeans and wear it.

Guess where I am buying my jeans?

LAC

07-01-2019, 12:41 PM

Nah, Hallensteins in Newmarket offered this service to me a few months back, bought a couple work pants and the needed altering which they got done for me $25 a piece.... not sure if any others offer that service though.

bull....

10-01-2019, 08:58 AM

looks like aus sales at xmas might have been poor , would mean all nz retailers with aus operations would be affected

https://thewest.com.au/business/retail/christmas-not-so-jolly-for-bricks-and-mortar-retailers-ng-b881069026z

pg0220

10-01-2019, 09:03 AM

"Investment bank Citi says customer traffic was down nearly 10 per cent as more shoppers move online or pull forward purchases into November."

Hope their online shopping platform has helped in that situation...

winner69

14-01-2019, 02:50 PM

Kathmandu already owned up to Australia sales not that good

Maybe Glassons Australia finding it more 'challenging' than they have left on

https://www.smartcompany.com.au/industries/retail/tough-christmas-retail-optimistic-2019/?utm_campaign=SC&utm_medium=email&utm_source=newslette

winner69

15-01-2019, 08:19 PM

Another clothing retailer bites the dust in OZ - bad December the last straw

winner69

16-01-2019, 02:45 PM

Beagle

16-01-2019, 03:27 PM

Stats NZ reports Electronic Card Spend in Apparel sector for December month was 4.4% DOWN on pcp ....hmm

Interesting comment on the numbers was this bit -

“Spending on fuel also fell sharply in December, but those savings at the pump don’t appear to have leaked across to other retail industries,” Ms Chapman said.

Ouch...not encouraging is it ! No wonder KMD who were the last to most recently update had such a shocker update. Guess who's next...
Betcha fuel volumes were up, (good for ZEL) as prices dropped so the ticket clippers including the Govt will be happy..oh wait, their GST take will have reduced on fuel, how sad, never mind :)

moka

16-01-2019, 10:33 PM

Could the struggling retail sector be the banks' next big problem? The RBA thinks so.
"One risk is that the changing retail environment might lead to store closures or insolvencies of domestic bricks-and-mortar retailers," the RBA paper argued. "This could result in higher vacancy rates at shopping centres and make it harder for shopping centre owners to meet their debt obligations. In turn, this could have implications for banks' asset quality."
CBA and Westpac total loan books are almost 70 residential mortgages, ANZ and NAB are a bit under 60 per cent. Commercial real estate accounts for between 6-to-10 per cent of the big banks' loan books, around half of which is retail.
Westpac nearly blew itself up in 1992 with a 40 per cent exposure to commercial real estate. More than 4 per cent of its loans were impaired and it needed an emergency recapitalisation to keep its doors open.
https://www.abc.net.au/news/2018-09-24/could-the-struggling-retail-sector-be-the-banks-next-big-problem/10294550

winner69

17-01-2019, 10:54 AM

From another forum. Wonder what ‘challenging’ really means for Glassons?. Group earnings growth driven out of Australia these days ....hmmm

Any from that forum -

News isnt any better on the other side of the Tasman -

"Shoppertrak, an analytical tool widely used in the retail sector, particularly by shopping centre landlords, showed foot traffic in the last two weeks of 2018 was down 15 per cent and 23 per cent respectively.
“I have been working in the retail space for 20 years now, and I can’t ever remember those sorts of numbers for Christmas,’’ Mr Stewart told The Australian… the biggest two weeks of Australia’s retail calendar just had a huge air swing at Christmas and Boxing Day trading”…
“Let’s be clear: for the first time in 20 years, many landlords are seriously nervous about what is going on”… He has sounded the alarm that with a poor Christmas many retailers could face a liquidity crisis."

Arbroath

17-01-2019, 11:17 AM

I read the whole article and it is quite grim reading...I think for HLG it clearly is a short-term negative buy we don't yet know the extent. Remember HLG is relatively ungeared (no bank debt just lease commitments) and has proven it can weather storms in the past. It's like a game of survivor in retail - outwit, outlast etc.

Might be a good opportunity to buy HLG again this year towards $3.00-3.50...I've dipped my toes back in around $4 only for a few.

News isnt any better on the other side of the Tasman -

"Shoppertrak, an analytical tool widely used in the retail sector, particularly by shopping centre landlords, showed foot traffic in the last two weeks of 2018 was down 15 per cent and 23 per cent respectively.
“I have been working in the retail space for 20 years now, and I can’t ever remember those sorts of numbers for Christmas,’’ Mr Stewart told The Australian… the biggest two weeks of Australia’s retail calendar just had a huge air swing at Christmas and Boxing Day trading”…
“Let’s be clear: for the first time in 20 years, many landlords are seriously nervous about what is going on”… He has sounded the alarm that with a poor Christmas many retailers could face a liquidity crisis."[/QUOTE]