HLG - Hallenstein Glasson

[Waltzing]

The markets never go up in one direction for 4 years..but maybe AUS and NZ will disconnect to some degree in certain defensive sectors.

[nztx]

The markets never go up in one direction for 4 years..but maybe AUS and NZ will disconnect to some degree in certain defensive sectors.

have they not already to a degree with all the carnage going on in Europe & the US ? ;)

[Waltzing]

Well it may take time for the international investors to notice that NZ is different. On returning to NZ it became clear that NZ has taken a new direction under Keys as NZ missed the bigger impacts of the GFC due to increasing population and capital inflows.

NZ tends to be over looked and dumped when money moves around the global markets.

HLG is a stock that can unfortunately get hit about a bit.

But perhaps there expansion into AUS can stop this trend depicted in the charts.

With Russia's vaccine 92% effective the world is going to change in the next 6 months and stocks such as travel will start to return. The other vaccines will change the world in the next 12 months we all know this.

Its not that HLG isnt worth good money its just where the money goes and NZX inclusion is vital to stop the chart bouncing up and down.

While we love the bouncing around its not actually good for the vast majority of investors.

[nztx]

Maybe in different times, different conditions - Waltzing .. not sure my crystal ball suggests going forward ST this time

Too many other factors present .. ;)

Excess money supply out there / relative unreported inflation / yield driven market / finite scrip,
just past one of the better (post Covid) retail recoveries period etc etc

but them I may be wrong too ;)

[Waltzing]

If HB doesnt perform probability a short term hit of a 50 cents only this time.

We are not expecting a hit to SP.

unless the ghost of LTCM hits markets.


HRO all over again...

biggest short SQ in 25 years.

biggest unwind since 2009.

[Beagle]

I'm still forecasting 50 cps fully imputed per annum in dividends = 69.44 cps gross = 9.7% yield on yesterday's closing price of $7.19
I think they can easily do 60 cps in earnings this year so are on a forward PE of just 12 and I think there is very strong evidence that they have excellent growth prospects in Australia with Glassons. The risk to my forecasts is to the upside.

They had 83 cps in cash at balance date, (and no obvious need to deploy it) so backing that out they are on a FY21 forecast PE net of cash of just 10.6 !

I think a takeover of IFT is more likely than not and if HLG doesn't get into the NZX50 that way its likely too under its own steam in the near future.

Peer comparative notes.
Briscoes closed yesterday at 19.4 times last years covid affected earnings.
WHS was at 24.2 times last years earnings.
The average is 21.8 times last years affected earnings. I think HLG has significantly better growth prospects than either of these two peers, (neither of which have their brand growing strongly in Australia) but if we just stick with the average 21.8 times, HLG's 2020 Covid affected earnings of 46.56 cps = Fair Value on a comparative basis = $10.15

They have a very strong balance sheet, no debt, excellent stock turn, the highest percentage of online sales of their peer group, new distribution center's in Aust and N.Z., no immediate need for further capex and are taking a very cautious approach towards store openings in the current environment so their warcheast of ~ $50m will likely continue to grow.

There is presently no analyst coverage, (this might change soon with NZX50 inclusion) and they are literally knocking on the door of NZX50 inclusion.

A trading update is due sometime in February, possibly quite soon, and I am expecting $24m for the first half up 50% on the prior comparative period.

Disc - I bought more last week and a further modest top up this morning making HLG my largest investment position.

[arekaywhy]

hmm...pushing toward $7.30 this morning?

[LaserEyeKiwi]

I'm still forecasting 50 cps fully imputed per annum in dividends = 69.44 cps gross = 9.7% yield on yesterday's closing price of $7.19
I think they can easily do 60 cps in earnings this year so are on a forward PE of just 12 and I think there is very strong evidence that they have excellent growth prospects in Australia with Glassons. The risk to my forecasts is to the upside.

They had 83 cps in cash at balance date, (and no obvious need to deploy it) so backing that out they are on a FY21 forecast PE net of cash of just 10.6 !

I think a takeover of IFT is more likely than not and if HLG doesn't get into the NZX50 that way its likely too under its own steam in the near future.

Peer comparative notes.
Briscoes closed yesterday at 19.4 times last years covid affected earnings.
WHS was at 24.2 times last years earnings.
The average is 21.8 times last years affected earnings. I think HLG has significantly better growth prospects than either of these two peers, (neither of which have their brand growing strongly in Australia) but if we just stick with the average 21.8 times, HLG's 2020 Covid affected earnings of 46.56 cps = Fair Value on a comparative basis = $10.15

They have a very strong balance sheet, no debt, excellent stock turn, the highest percentage of online sales of their peer group, new distribution center's in Aust and N.Z., no immediate need for further capex and are taking a very cautious approach towards store openings in the current environment so their warcheast of ~ $50m will likely continue to grow.

There is presently no analyst coverage, (this might change soon with NZX50 inclusion) and they are literally knocking on the door of NZX50 inclusion.

A trading update is due sometime in February, possibly quite soon, and I am expecting $24m for the first half up 50% on the prior comparative period.

Disc - I bought more last week and a further modest top up this morning making HLG my largest investment position.

Excellent summation!

I'm wondering with the large cash balance if they are considering expanding/acquiring with another brand with a different market with which they could leverage there existing fulfilment infrastructure. Could just be an online effort initially as well. Maybe something in footwear (think Allbirds) or a clothing subscription offering.

[winner69]

I'm still forecasting 50 cps fully imputed per annum in dividends = 69.44 cps gross = 9.7% yield on yesterday's closing price of $7.19
I think they can easily do 60 cps in earnings this year so are on a forward PE of just 12 and I think there is very strong evidence that they have excellent growth prospects in Australia with Glassons. The risk to my forecasts is to the upside.

They had 83 cps in cash at balance date, (and no obvious need to deploy it) so backing that out they are on a FY21 forecast PE net of cash of just 10.6 !

I think a takeover of IFT is more likely than not and if HLG doesn't get into the NZX50 that way its likely too under its own steam in the near future.

Peer comparative notes.
Briscoes closed yesterday at 19.4 times last years covid affected earnings.
WHS was at 24.2 times last years earnings.
The average is 21.8 times last years affected earnings. I think HLG has significantly better growth prospects than either of these two peers, (neither of which have their brand growing strongly in Australia) but if we just stick with the average 21.8 times, HLG's 2020 Covid affected earnings of 46.56 cps = Fair Value on a comparative basis = $10.15

They have a very strong balance sheet, no debt, excellent stock turn, the highest percentage of online sales of their peer group, new distribution center's in Aust and N.Z., no immediate need for further capex and are taking a very cautious approach towards store openings in the current environment so their warcheast of ~ $50m will likely continue to grow.

There is presently no analyst coverage, (this might change soon with NZX50 inclusion) and they are literally knocking on the door of NZX50 inclusion.

A trading update is due sometime in February, possibly quite soon, and I am expecting $24m for the first half up 50% on the prior comparative period.

Disc - I bought more last week and a further modest top up this morning making HLG my largest investment position.

Jeez Beagle, forecasting eps 60 cents not the usual bullish beagle

EPS 60 cents is $36m npat

If they do $24m in H121 then the last year (H220 + H121) is $36.3m - even with all covid issues. So $36m for full year would be seeing earnings decline in H2.

Surely we should add a bit of growth in --- maybe $40m full year, ie eps 67 cents

And 67 times 21.8 is $14.60

That's half todays price - spooky eh

[Balance]

Jeez Beagle, forecasting eps 60 cents not the usual bullish beagle

EPS 60 cents is $36m npat

If they do $24m in H121 then the last year (H220 + H121) is $36.3m - even with all covid issues. So $36m for full year would be seeing earnings decline in H2.

Surely we should add a bit of growth in --- maybe $40m full year, ie eps 67 cents

On that note, a man just have to buy a few more of them beauties!

[winner69]

On that note, a man just have to buy a few more of them beauties!

Good move -- probably see a new ATH today .... or tomorrow

[Beagle]

Jeez Beagle, forecasting eps 60 cents not the usual bullish beagle

EPS 60 cents is $36m npat

If they do $24m in H121 then the last year (H220 + H121) is $36.3m - even with all covid issues. So $36m for full year would be seeing earnings decline in H2.

Surely we should add a bit of growth in --- maybe $40m full year, ie eps 67 cents

You're quite right mate. I am being super conservative with 60 cps, (far too conservative...which is unlike me). In my defense I have only had time for one coffee this morning and I did say "I think they can easily do 60 cps in earnings this year"

To be honest I haven't really given a lot of thought to the second half but I think ultra low interest rates and people's inability to travel will see retail demand remain at a very robust level. Maybe we see as much as $20m for the second half which would lead to around $44m for the year and eps of 74 cents ? I guess that raises the possibility of what on earth are they going to do with all that cash ?

[winner69]

You're quite right mate. I am being super conservative with 60 cps, (far too conservative...which is unlike me). In my defense I have only had time for one coffee this morning and I did say "I think they can easily do 60 cps in earnings this year"

To be honest I haven't really given a lot of thought to the second half but I think ultra low interest rates and people's inability to travel will see retail demand remain at a very robust level. Maybe we see as much as $20m for the second half which would lead to around $44m for the year and eps of 74 cents ? I guess that raises the possibility of what on earth are they going to do with all that cash ?

OMG - .74 times 21.8 gives share price of $16.13

[Beagle]

LOL that would be very nice but 21.8 is the average of the other two retailers on last years covid affected earnings. I don't think we can expect it to trade at that multiple on this years earnings but at $10 its fairly priced compared to its peers and as mentioned, I think HLG has much better growth prospects going forward.

[Balance]

OMG - .74 times 21.8 gives share price of $16.13

Call it 15X = $11.11

[Waltzing]

economy exploding on forward govt spending...

$13

if aussi numbers are the same for employment.

[Davexl]

Call it 15X = $11.11

Yes thank you Balance for keeping it "Real".
Bit of excessive exuberance there on the P/E front methinks...trending to long term averages / likely correction etc...

[dreamcatcher]

Come on boys you starting to sound like the Three Stooges with this guessing game .....

[Beagle]

Call it 15X = $11.11

Yes...I was pondering what is the right multiple for FY21 and I arrived at almost the same conclusion. I am thinking 15-16 times current year earnings based on their multi year track record of strong growth in Australia with Glassons. I think the shares are worth $10.15 now and my price target for 12 months hence is $11.50.

The yield could be VERY interesting. Unless they have plans for the substantial ~ $50m cash on hand I expect they could pay out close to the whole years earnings this year.

Canny investors will know this trades cum a likely twenty something cent fully imputed dividend likely payable in April...or maybe its 30 cents ?

[winner69]

NZD up on surprisingly low unemployment rate

So less people unemployed / more working - that’s good for HGH

And NZD good for HGH margins later in year.

[Waltzing]

NZX inclusion with no increase in share capital and if interest rates stay low for 3-4 years it explodes to 13 before falling back on lack of shares for sale.

stocks often over shoot if there is limited supply.

people with saving and deposits will be desperate and inclusion of NZX will force the share price to over shoot valuations.

The effect of low interest rate and TD is yet to take full effect. Panic will set in at some stage to buy the stock if profits increase.

Demand of travel is already backing up.

Every street here is starting to look very spiffy.

Notice that it can make jumps of over 2 dollars in short time frames before falling back on good news.

[Snow Leopard]

NZD up on surprisingly low unemployment rate

So less people unemployed / more working - that’s good for HGH

And NZD good for HGH margins later in year.

Right code and wrong thread

or

Right thread and wrong code ?

[Waltzing]

its not W(N)

its W(D)

digital Winner

[winner69]

Right code and wrong thread

or

Right thread and wrong code ?

Right - it's just that Hallensteins Glassons use HGH (Hallensteins Glassons Holdings) in some documents I was reading. I am getting brainwashed :cool:

Obviously need to be more careful

[Beagle]

Winner69;870207]Right - it's just that Hallensteins Glassons use HGH (Hallensteins Glassons Holdings) in some documents I was reading. I am getting brainwashed :cool:

Obviously need to be more careful

Quite probably not other than to avoid confusion on here. I think both HLG and HGH are excellent buying and expect both to have very positive announcements later this month.

[Panda-NZ-]

So less people unemployed / more working - that’s good for HGH


Less people buying suit bundles for interviews though.

Though otherwise agree -- back up the track and load everything "H" :)

[Baa_Baa]

You buy into unprecedented high, just know what you’re buying into, a cyclical, which might have satisfying upside but when it stops you have to also know when to get out, just saying

Caveat emptor

[Panda-NZ-]

If the PE ratio is low compared to other retailers its not that expensive.

[Balance]

You buy into unprecedented high, just know what you’re buying into, a cyclical, which might have satisfying upside but when it stops you have to also know when to get out, just saying

Caveat emptor

Thanks, Baa_Baa. Please come back and caution us again when sp hits $10.00

[Waltzing]

well is it cyclical this time... no because govnt has brought the good times forward in a time warp....

the only reason this thing drops a wing is it not in the NZX nifty fifty..

[Balance]

well is it cyclical this time... no because govnt has brought the good times forward in a time warp....

the only reason this thing drops a wing is it not in the NZX nifty fifty..

HLG's market cap is now $437m (to be $700m+ imo by Sept 2021) vs SKT at $312m.

Since that has been the case now for pretty much most of 2020, hard to fathom how SKT can still stay in NZX50.

[Greekwatchdog]

Liquidity..

[Balance]

Liquidity..

HLG's liquidity has been improving but maybe, just maybe a share split may help liquidity?

In any case, it sounds like HLG is definitely next cab off the rank into NZX50 if (for whatever reason - like M&A) a stock exits NZX50.

[winner69]

Another one bites the dust in Wellington with David Jones going to close - amazing its still there though

Farmers store across the road but by far the glitziest big store left on the Golden Mile (another anachronistic thing) is the combined Hallensteins Glassons flag ship store just up the road

Maybe retail in downtown Wellington (and other cities) is dying or already dead - if so this store might be one of the worst performing of their stores. At least they sold the building and after spending zillions on the outfit hopefully not stuck with a long term expensive lease.

[jimdog31]

HLG's liquidity has been improving but maybe, just maybe a share split may help liquidity?

In any case, it sounds like HLG is definitely next cab off the rank into NZX50 if (for whatever reason - like M&A) a stock exits NZX50.

You may recall I got shot down on here for suggesting such heresy not long ago!

[Beagle]

.......................12284


HLG's liquidity has been improving but maybe, just maybe a share split may help liquidity?

In any case, it sounds like HLG is definitely next cab off the rank into NZX50 if (for whatever reason - like M&A) a stock exits NZX50.

I think a share split is a very good idea and would definitely enhance liquidity. I'll send an email to the board and outline why I think that's a good idea.

Got thinking overnight about what the real PE is adjusted for the ~ $50m cash mountain they have (which is 83 cps). $7.33 - 0.83 = $6.50 one is paying for future earnings and if they make 74 cps this year that's an adjusted FY21 PE of just 8.8 which is absolutely nuts for a company with a multi year track record of strong growth in Australia.

On the TA side of thing, while I'm no expert by any means, but to me, the chart looks very encouraging ! RSI is only 50 so its certainly not overbought ! Chart above is now and the one below one is when it was a sell just as Covid hit. Very different charts. The trend is your friend.

[Waltzing]

On Balance

" hard to fathom how SKT can still stay in NZX50."

yes!

and i suggested a share split a while ago ... best idea for this best dressed ..

[winner69]

A 2 for 1 would make share price around 360

Waltzing man would say I told you so - shareprice cycles between $3 and $7 so his sophisticated IT system would signal a BUY ...and share price would cycle back up to $7 :t_up::):confused::ohmy::scared::(

Only reason I can see for a stock split.

[Beagle]

If you believe a stock split would be beneficial to shareholders and give enhanced liquidity and improve the chances of NZX50 inclusion please support my representations to the board along those lines by contacting them here. https://www.hallensteinglasson.co.nz/contact

[Waltzing]

"so his sophisticated IT system would signal a BUY"

DISC: the Binary Platform Components are not a BUY and SELL signal system. One of our soft bits and pieces is Back Office.

if you need buys and sell anyone can dump to the 365 versions of OFFICE and use its new data types to do your stats.

Notice that EXCEL now supports a lot of new work to speed its engine up and formulas as LAMBDA. You need the insider version though.

[winner69]

Deleted ..waste of time

[LaserEyeKiwi]

Another one bites the dust in Wellington with David Jones going to close - amazing its still there though

Farmers store across the road but by far the glitziest big store left on the Golden Mile (another anachronistic thing) is the combined Hallensteins Glassons flag ship store just up the road

Maybe retail in downtown Wellington (and other cities) is dying or already dead - if so this store might be one of the worst performing of their stores. At least they sold the building and after spending zillions on the outfit hopefully not stuck with a long term expensive lease.

Lambton Quay shopping district have suffered immensely from the work from home boom - tens of thousands of government and corporate workers in wellington CBD are no longer going into the office 5 days a week (the new normal is somewhere around 1-3 days a week in the office for many) - so shops & cafes/bars in the Lambton Quay area are suffering from the big drop in foot traffic. The area has the highest average salary workers in New Zealand, but they only shop here when they are in the office - they go to the suburban malls etc generally when working from home & weekends (as there is bugger all parking in that area of CBD, and its really expensive). David Jones was targeting the high end customer so not surprised it is closing (good strategy for Lambton Quay pre-pandemic, not so much now). Notably the other side of the central city, Courtney place/manners street/cuba street retail area is still doing very well as that was not reliant on the Lambton Quay market (HLG has both a new Glassons store and a Hallensteins on Cuba Mall.)

Idle thought: they should turn the David Jones location into an entertainment complex (cinemas etc), would bring more people into the area on weekends (which have always been particularly quiet shopping wise down that end of town)

[Beagle]

Those Contact Forms go nowhere ...won’t go to those who matter

Text Chairman Warren Bell 021 2207254 to make sure your plea is heard or even give him a buzz

Just got this email from them.
Dear Mr (I've edited this for privacy reasons)

I have passed you email on to the Chairman of the Board.

Kind regards


Stuart

[winner69]

As I’ve said before I think Hallensteins Board don’t even think about the share price and furthermore they give the impression retail share holders are a pain in the butt but a necessary evil that’s part of being a listed company.

Patently clear from the brevity of their updates and the lack of enthusiasm shown at AGMs

But you never know they might listen to you if many of you clamour for a share split.

[LaserEyeKiwi]

If you believe a stock split would be beneficial to shareholders and give enhanced liquidity and improve the chances of NZX50 inclusion please support my representations to the board along those lines by contacting them here. https://www.hallensteinglasson.co.nz/contact

submission done.

[Beagle]

Have to agree they're a pretty conservative lot...kind of old fashioned...but I like that. Listed in 1947, N.Z.'s oldest listed company.
I like companies that have been around longer than I have.
Agree its unlikely they will split but you never know...if enough people ask for it they might listen.
Thanks for your support LaserEyeKiwi.

For what its worth I suggested a 5:1 stock split.

[winner69]

Just got this email from them.
Dear Mr (I've edited this for privacy reasons)

I have passed you email on to the Chairman of the Board.

Kind regards


Stuart

Well done Stuart - give that man a rise

Best of luck hearing back from Warren

Owes me a few responses

[macduffy]

Got thinking overnight about what the real PE is adjusted for the ~ $50m cash mountain they have (which is 83 cps). $7.33 - 0.83 = $6.50 one is paying for future earnings and if they make 74 cps this year that's an adjusted FY21 PE of just 8.8 which is absolutely nuts for a company with a multi year track record of strong growth in Australia.


As the E in P/E represents "earnings", shouldn't we adjust by the amount of interest (earnings) from the $50m cash mountain, not the $50m itself?

:cool:

[winner69]

Way to go is to bring it up with long time major shareholders while sipping wine on his yacht while cruising Marlborough Sounds

ST once had such an influencer

[Waltzing]

HLG will have some marginal stores in 2nd tier cities perhaps.

DISC: we have some soft ware in europe but that toy is for developers.

[LaserEyeKiwi]

As the E in P/E represents "earnings", shouldn't we adjust by the amount of interest (earnings) from the $50m cash mountain, not the $50m itself?

:cool:

Not sure its material given current interest rates.

[Beagle]

As the E in P/E represents "earnings", shouldn't we adjust by the amount of interest (earnings) from the $50m cash mountain, not the $50m itself?

:cool:

What earnings from interest on deposit ? Basically nothing these days. To my way of thinking with HLG you are buying a cash mountain, (the size of which is unprecedented) and future earnings. Eventually they have to do something with all that cash (although as a conservative company I expect them to continue to run a high cash balance until we're completely out of the woods with Covid). That said if they're earning 74 cents per share, (hardly expending anything on capex so cash flow before depreciation is much more than 74 cps) and they already have a very high cash balance so I think my estimate of 50 cps fully imputed for FY21 is looking excessively conservative.

For what its worth this is the brief message I sent to the board


Dear Directors, You will probably be aware there has been some commentary from Forsyth Barr that our company is knocking on the door of NZX50 inclusion and is ostensibly the next cab off the rank if one of the existing constituents falls out. One of the criteria for inclusion is based around the liquidity of the shares and I feel with the share price over $7 a share split would be most helpful in boosting liquidity. Perhaps a 5:1 like Pushpay recently did ? Kind regards ....

[Waltzing]

Compare to size of capital allocated HLG has over the decade generated profit for us almost more than any other share here in NZ or even on overseas exchange.

No other stock has given us 3 slices at the cake in such short time frames.

The capital allocated should always be calculated in hours invested on the market and that where buy good luck it out performed.

sorry no fun comments in this one. No license taken with words like Double Bubble or anything fun...

[peat]

spread for any real parcel is very high
you'd have to pay $8 to get only 15k shares.

[macduffy]

What earnings from interest on deposit ? Basically nothing these days

That, of course, was my point!

;)

[Waltzing]

"That, of course, was my point!"

we all figured that out back in april last year....old news

[macduffy]

It seems I'll have to spell it out for Waltzing.......

I was suggesting that it was the earnings (minimal) on the $50m war chest that should be used to adjust the E in HLG's P/E, not the "capital" $50m sum itself.

Was that correct, or not?

[Beagle]

Perhaps we should move on. I'm really not any fan of these cash adjusted PE's anyway. My point is simply that one is buying not just a high current and future earnings stream but a company with a LOT of cash on hand (83 cps at last balance date) and no debt. I think from a financial point of view that puts them in a very robust position going forward.

I see WHS has announced a special dividend this morning. Perhaps that's an idea for some of HLG's cash mountain or maybe we just "make do" with them paying out all earnings this year.
74 cps fully imputed = ~ $1.03 per share gross inclusive of imputation credits and on the current share price that's ~ 14% gross yield...WOW !!

[jimdog31]

Perhaps we should move on. I'm really not any fan of these cash adjusted PE's anyway. My point is simply that one is buying not just a high current and future earnings stream but a company with a LOT of cash on hand (83 cps at last balance date) and no debt. I think from a financial point of view that puts them in a very robust position going forward.

I see WHS has announced a special dividend this morning. Perhaps that's an idea for some of HLG's cash mountain or maybe we just "make do" with them paying out all earnings this year.
74 cps fully imputed = ~ $1.03 per share gross inclusive of imputation credits and on the current share price that's ~ 14% gross yield...WOW !!


Unfortunately (as much as I agree with them not paying the subsidy back) I think they will suffer a PR backlash from a special divy. I dont think that would be wise. WHS are clearly able to do it without worrying about that now.

Id love to have cake and eat it too.

Ps welcome back mate!

[Waltzing]

"74 cps fully imputed = ~ $1.03 per share gross inclusive of imputation credits and on the current share price that's ~ 14% gross yield...WOW !!"

exactly...

over and out ...... hang on.....

Bulls eye yet again.. MR B takes home the bag and the money....

forget the WS as it should have been an IRD and Accounting standard for public companies and is the fault of the implementation.

P/E is only an historical function of capital structures in only as much as capital is used to invest in revenue generating operations and is a derivative of Accounting Body Standards and statue IRD interpretation. Once again MR B hits the bulls eye.

[HCR20]

Those Contact Forms go nowhere ...won’t go to those who matter

Text Chairman Warren Bell 021 2207254 to make sure your plea is heard or even give him a buzz


Be careful putting phone nums up here.

[Balance]

Thanks, Baa_Baa. Please come back and caution us again when sp hits $10.00

Back to $7.50 (24c dividend in Dec 2020 already in the bank) and heading in the right trajectory to $10.00.

Hope Baa_Baa has taken note to remind us to be cautious (again) at $10.00.

[Beagle]

Unfortunately (as much as I agree with them not paying the subsidy back) I think they will suffer a PR backlash from a special divy. I dont think that would be wise. WHS are clearly able to do it without worrying about that now.

Id love to have cake and eat it too.

Ps welcome back mate!

Thanks mate...I've probably eaten more than enough cake this summer already :blush:

[winner69]

Be careful putting phone nums up here.

He puts it up publicly on NZX announcements

Probably got 2 phones anyway ...one for his business things that probably somebody else answers anyway ....and the secret one where important stuff goes.

Mary Devine puts her number on some announcements as well

Like an invitation give me a buzz if you want to discuss anything

[Balance]

He puts it up publicly on NZX announcements

Probably got 2 phones anyway ...one for his business things that probably somebody else answers anyway ....and the secret one where important stuff goes.

Mary Devine puts her number on some announcements as well

Like an invitation give me a buzz if you want to discuss anything

Speaking of important stuff :

'Man suffers a mild heart attack while on a walk with wife.

Wife grabs his mobile and asks for his login numbers so she can dial St Johns Ambulance.

Man suffers severe heart attack.' :eek2:

[winner69]

Speaking of important stuff :

'Man suffers a mild heart attack while on a walk with wife.

Wife grabs his mobile and asks for his login numbers so she can dial St Johns Ambulance.

Man suffers severe heart attack.' :eek2:

Maybe why or why not you don’t use your finger print as security (or whatever the method is called)

[Baa_Baa]

Back to $7.50 (24c dividend in Dec 2020 already in the bank) and heading in the right trajectory to $10.00.

Hope Baa_Baa has taken note to remind us to be cautious (again) at $10.00.

Mission not accepted. Not necessary either as I know you old crusty's have the skills to ride the roller coaster and be gone when the time comes, without waiting for me or anyone else to tell you.

Chart (monthly) is pretty impressive (https://invst.ly/tp00f), nice breakout to new ATH's, well above 50/200 EMA's, chasing up the BB's, on falling monthly volume, wide spread MACD, topping RSI, topping/topped Stoch.

Enjoy the ride.

[Balance]

Mission not accepted. Not necessary either as I know you old crusty's have the skills to ride the roller coaster and be gone when the time comes, without waiting for me or anyone else to tell you.

Chart (monthly) is pretty impressive (https://invst.ly/tp00f), nice breakout to new ATH's, well above 50/200 EMA's, chasing up the BB's, on falling monthly volume, wide spread MACD, topping RSI, topping/topped Stoch.

Enjoy the ride.

I bought more HLG shares even as you sounded your cautions.

I need more cautions!

[Balance]

Maybe why or why not you don’t use your finger print as security (or whatever the method is called)

What about the facial recognition thingi on the iPhone? That’s rather dangerous too?

[Beagle]

Mission not accepted. Not necessary either as I know you old crusty's have the skills to ride the roller coaster and be gone when the time comes, without waiting for me or anyone else to tell you.

Chart (monthly) is pretty impressive (https://invst.ly/tp00f), nice breakout to new ATH's, well above 50/200 EMA's, chasing up the BB's, on falling monthly volume, wide spread MACD, topping RSI, topping/topped Stoch.

Enjoy the ride.

Hi mate. I have upmost respect for your TA skills but I think your long term initial chart line reference point misses the mark.
I started investing in HLG at ~ $2.75 and was always and only ever in it for the huge dividends. Please go back and have a look at my posts in August 2016 and you'll see my dividend income motivation clearly displayed.

If your initial chart line started in 2016 you'd have a very different looking trend line. The thing is mate, growth in Glassons Australia since FY17 has been deeply impressive and in my view at least this has transformed them from a pure cyclical into a growth company. Not only has Glassons Australia growth been very impressive, (ably lead by Tim Glassons son) but their market penetration there is still only one fifth of their penetration with Glassons in N.Z. so they have huge potential there unlike their peers (WHS and BGR) who aren't even in Australia !

The growth in Glassons Aust is the key bit of information you're not correctly representing in your chart. I humbly suggest you recalibrate the starting point of your trend line to the beginning of 2016. If it was then possible to adjust for the fabulous dividends they pay twice yearly you would see that they have been in an overall uptrending channel (apart from Covid) since mid 2016.

HLG is one of my most rewarding investments of all time, (especially taking into account the huge fully imputed dividends), and despite the recent modest share price gain I am extremely confident going forward so its my #1 investment position on the NZX so believe me I am putting my money where my barking is !

Wake me up when we get to $10, it won't be very long ;)

[Baa_Baa]

Hi mate. I have upmost respect for your TA skills but I think your long term initial chart line reference point misses the mark.
I started investing in HLG at ~ $2.75 and was always and only ever in it for the huge dividends. Please go back and have a look at my posts in August 2016 and you'll see my dividend income motivation clearly displayed.

If your initial chart line started in 2016 you'd have a very different looking trend line. The thing is mate, growth in Glasson since FY17 has been deeply impressive and in my view at least this has transformed them from a pure cyclical into a growth company. Not only has Glassons Australia growth been very impressive, (ably lead by Tim Glassons son) but their market penetration there is still only one fifth of their penetration with Glassons in N.Z. so they have huge potential there unlike their peers (WHS and BGR).

The growth in Glassons Aust is the key bit of information you're not correctly representing in your chart. I humbly suggest you recalibrate the starting point of your trend line to the beginning of 2016. If it was then possible to adjust for the fabulous dividends they pay twice yearly you would see that they have been in an overall uptrending channel (apart from Covid) since mid 2016.

HLG is one of my most rewarding investments of all time and despite the recent share price gain I am extremely confident going forward and its my #1 investment position on the NZX so believe me I am putting my money where my barking is !

Yo Beagle, I just slapped up all the data I have. Still a lovely chart and congrats to you and others for seeing the value and getting in at a good price. 2020 Covid prices was in hindsight a terrific gift for such a quality asset. My small holding is nicely green too. I forgot to mention I'm an old crusty as well, so see you at the exit when the time comes, there's no way I'm leaving these lovely capital gains on the table. Nice divvy as you say, while we wait. It's not a forever share for me.

All the best.

[winner69]

Mission not accepted. Not necessary either as I know you old crusty's have the skills to ride the roller coaster and be gone when the time comes, without waiting for me or anyone else to tell you.

.


That time could possibly be next year when sales and earnings growth go negative - ie lower sales than pcp

Can't repeat a bonanza period with so much catch up sales in it

baa_baa, get the gist?

[Beagle]

We will see Winner. Huge house price gains spiced up with ultra low interest rates and much higher than expected employment level's is putting plenty of spice and vigor into retail spending especially coupled with people's inability to travel internationally. I think these tailwinds will be more enduring than many others expect and all the while Glassons is building more and more brand recognition and critical mass in Australia.

I get a lot of comfort from management's clear expertise in handling challenging conditions, (Tim Glassons 20% stake, the owners eye as Percy refers too it), and this being the oldest listed company on the NZX. I sleep very well at night with plenty of these puppies in the kennel.

[iceman]

What earnings from interest on deposit ? Basically nothing these days. To my way of thinking with HLG you are buying a cash mountain, (the size of which is unprecedented) and future earnings. Eventually they have to do something with all that cash (although as a conservative company I expect them to continue to run a high cash balance until we're completely out of the woods with Covid). That said if they're earning 74 cents per share, (hardly expending anything on capex so cash flow before depreciation is much more than 74 cps) and they already have a very high cash balance so I think my estimate of 50 cps fully imputed for FY21 is looking excessively conservative.

For what its worth this is the brief message I sent to the board

Thanks for this Beagle. I'm sorry but I just do not see how a share split from $7.00 to $3.50 or $1.40 would make a difference. It certainly wouldn't for my modest shareholding !

[iceman]

Speaking of important stuff :

'Man suffers a mild heart attack while on a walk with wife.

Wife grabs his mobile and asks for his login numbers so she can dial St Johns Ambulance.

Man suffers severe heart attack.' :eek2:

No idea what the point is with your post mate but you don;t need a login code to call an emergency number like 111 !!!!

[Beagle]

Thanks for this Beagle. I'm sorry but I just do not see how a share split from $7.00 to $3.50 or $1.40 would make a difference. It certainly wouldn't for my modest shareholding !

Just adds more liquidity mate, which is a factor with NZX50 inclusion.

[iceman]

Just adds more liquidity mate, which is a factor with NZX50 inclusion.

But does it , if the big shareholders don't sell any ?

[Balance]

But does it , if the big shareholders don't sell any ?

Lower sp (say $1.00 to $2.00) usually encourages & allows more trading activity - 5 cents on $1.00 is 5%. 5 cents on $7.68 (go you good thing HLG) is not worth the effort.

[LaserEyeKiwi]

whoa. Nice slingshot today.

[winner69]

nobody mentioned $7.68 must be a new ATH

WHS divie announcement sets expectation of big HLG divie and punters are wishing for at least 30 cents in March (?) so getting in before it's just too expensive

Opposite to greater liquidity is today where supply is short - those who really want need to pay top dollar.

C'mon guys - keep buying no matter the price

Update any time now - you'll be paying more than 8 bucks then

[850man]

small volume but up >5% today - wow

[winner69]

small volume but up >5% today - wow

good having stuff all liquidity eh

Like you name mate 850man --- sign that HLG will hit 850 very soon - only 10% away

[nztx]

nobody mentioned $7.68 must be a new ATH

WHS divie announcement sets expectation of big HLG divie and punters are wishing for at least 30 cents in March (?) so getting in before it's just too expensive

Opposite to greater liquidity is today where supply is short - those who really want need to pay top dollar.

C'mon guys - keep buying no matter the price

Update any time now - you'll be paying more than 8 bucks then


I dont believe it's expensive until it sails past a peg or two past the 11 or mid day

then it becomes cheap for those on the other side of the door wanting in .. ;)

Now for expensive - IMO FRE looks expensive .. and no Div .. ;)

Is MFT cheap or expensive suddenly for those deciding it's a must have ? ;)

[nztx]

small volume but up >5% today - wow


Good sign - no-one wants to sell ;)

If HLG did a Share split in same circumstances - will anyone want to sell then either ? ;)

Just a matter of time & those in on board could have very much wider smiles as pieces
of HLG's 60 mil Cap on the loose become as scarce as hens teeth .. ;)

[winner69]

Good sign - no-one wants to sell ;)

If HLG did a Share split in same circumstances - will anyone want to sell then either ? ;)

No

Share split a waste of time and money

[nztx]

No

Share split a waste of time and money


Agree

In current conditions if there's a run of demand it's possible even 14/15 wouldn't be sufficient to shake loose
parcels of any reasonable size, if everyone really likes things & few want to sell .. ;)

[Beagle]

No

Share split a waste of time and money

Are they ? Interesting study https://finance.zacks.com/stock-price-typically-up-after-forward-split-1189.html

For the time poor amongst us - "Although stock splits have no affect on the intrinsic value of the stock, being basically cosmetic, many studies show that stock splits result in high performance. In two separate studies in1996 and in 2003, David Ikenberry, Chairman of the Finance Department at the University of Illinois at Urbana-Champaign, found price performance of split stocks outperformed the market by 8 percent during the year following the split and by 12 percent over the ensuing three years. He looked at over 1,000 stocks for each study, including 2-for-1, 3-for-1 and 4-for-1 stock splits".

I took the liberty of asking for a link to this study to be sent to our Chairman...if you don't ask, you don't get ;)

[sb9]

The way price in moving you'll be forgiven to think its HLG that declared special divvy not WHS :p

[nztx]

The way price in moving you'll be forgiven to think its HLG that declared special divvy not WHS :p


Haha yes -- may be there's some expectation out there .. ;)

How bout HGH which is coming up -usually April Div pay ? ;)

[nztx]

I think the jury are reserving their decision on a Share Split .. ;)

No Split hasn't harmed MFT

Look what a 4:1 Split did for PPH -- has it recovered yet to $9.25 pre Split ? ;)

IMO - I'd far rather see everyone start considering the untold extra intrinsic value that
may lay in HLG and start preparing to shed nearer 20 a piece for a slice of the action .. ;)

[sb9]

Haha yes -- may be there's some expectation out there .. ;)

How bout HGH which is coming up -usually April Div pay ? ;)

I think there'll be lot of backlash if they indeed declare a special divvy..

With re HGH if RNBZ restrictions are lifted we could see some handsome divvy payout.

[nztx]

I think there'll be lot of backlash if they indeed declare a special divvy..

With re HGH if RNBZ restrictions are lifted we could see some handsome divvy payout.

taxable bonus issue then ? with full imputation credits ... are these still done ? ;)

[BlackPeter]

Just adds more liquidity mate, which is a factor with NZX50 inclusion.

Not quite sure whether this is true.

Currently 23.27% of all HGL shares are hold by insiders - and they are basically not on market (which is relevant for the NZX50 inclusion).

No matter, how often you split the shares - there will be absolutely no change in liquidity, unless the insiders decide to sell some of their shares.

Unless they (or better he - most of them are hold by Tim Glasson) do, there still will be 23.27% of all shares in insider hands. It does not matter at all, whether these are 13.9 m "full" shares or 27.8 m "half" shares or 69.4 m "fith-"shares.

Liquidity only improves if more of these insider shares are available on market. If that's what Tim Glasson wants, he could sell today. Why should he after a share split?

Having said that - I remember times when HGL used to be part of the NZX50 index (might show my age), i.e. there is absolutely no need for them to split their shares to get back, they just need to have (relative to the others in the NZX50) a high enough market cap of their free floating shares.

[Beagle]

I think the jury are reserving their decision on a Share Split .. ;)

Compelling evidence for the jury / (Board ;) ), to consider with very large sample sizes for each study
price performance of split stocks outperformed the market by 8 percent during the year following the split and by 12 percent over the ensuing three years. He looked at over 1,000 stocks for each study, including 2-for-1, 3-for-1 and 4-for-1 stock splits".

We need the extra liquidity for NZX50 inclusion.

[Panda-NZ-]

If you want liquidity issues try DGL (delegats).

Hallensteins isn't too bad on that front.

[nztx]

Compelling evidence for the jury to consider with very large sample sizes for each study


But with HLG's tight Register with so many happy campers wanting to stay put - some of the SP formulations
forward eclipse that 12% in just one short rush - compounded forward with more of the same the 12%
over 3 years may be comparable to well say 75% 125% 250% - anyone want to pick a number after looking
at HLG's recent SP record ? ;)

I dont see further new holders buying in wanting to sell anytime fast either once news hits the wire .. ;)

Remember - there are vast extra bucks out there not going on holiday overseas, not liking the Bank's extortionary low
deposit rates, and a huge amount of new Retail Investor attention that materialised in past year & lots of bucks with them ...

Another large pile to float in off Bonus Bonds being liquidated in near future too


And still just the same number of slightly less that 60 mil HLG shares on issue ..

What does supply & demand dictate on where things may go ?

[Beagle]

Not quite sure whether this is true.

Currently 23.27% of all HGL shares are hold by insiders - and they are basically not on market (which is relevant for the NZX50 inclusion).

No matter, how often you split the shares - there will be absolutely no change in liquidity, unless the insiders decide to sell some of their shares.

Unless they (or better he - most of them are hold by Tim Glasson) do, there still will be 23.27% of all shares in insider hands. It does not matter at all, whether these are 13.9 m "full" shares or 27.8 m "half" shares or 69.4 m "fith-"shares.

Liquidity only improves if more of these insider shares are available on market. If that's what Tim Glasson wants, he could sell today. Why should he after a share split?

Having said that - I remember times when HGL used to be part of the NZX50 index (might show my age), i.e. there is absolutely no need for them to split their shares to get back, they just need to have (relative to the others in the NZX50) a high enough market cap of their free floating shares.

https://www.pdn.ac.lk/purse/Proceedings/2011/it/it_7.pdf Excerpt
According to the analyses, 54% of companies recorded an increment of trading
volume after the stock split regardless of length of the data frame, and the trading volume
increased significantly in 60% of companies. From a total of 26 companies, 65% and 62%
of companies have increased their market price and number of trading respectively

[nztx]

Compelling evidence for the jury / (Board ;) ), to consider with very large sample sizes for each study

We need the extra liquidity for NZX50 inclusion.


For that loyal holders may have to name the inflated price at which they may consider parting
with a fraction of their treasured HLG trove .. no two ways about that .. ;)

Can't have your cake & eat it too (unless you own a bakery) ;)

[nztx]

7.75 .. 8.00 here we come

Anyone want to sell up or spit out a few from their stockpile to help out a slight liquidity problem,
or maybe all are even more eager happy campers for the time being ? ;)

[winner69]

Share split good idea or not (there are academic papers showing them good or ineffective) ....it all comes down to what the likes of guru advisors like Jarden recommend for NZ situation.(at a cost of course)

[nztx]

Share split good idea or not (there are academic papers showing them good or ineffective) ....it all comes down to what the likes of guru advisors like Jarden recommend for NZ situation.(at a cost of course)


Or do nothing & let the market participants (buyers / sellers / advisors) decide what value they place on the shares

seems to have worked well in the past - why change a thing ? ;)

[winner69]

Or do nothing & let the market participants (buyers / sellers / advisors) decide what value they place on the shares

And we go the full circle and the current Board couldn’t care two hoots if they are in NZX50 or not ......and probably look at the share price every now and again and say what the heck the worlds gone mad

[nztx]

And we go the full circle and the current Board couldn’t care two hoots if they are in NZX50 or not ......and probably look at the share price every now and again and say what the heck the worlds gone mad


possibly .. and any tinkering with the Register probably costs extra dough in administering the thing
especially if higher volumes go through .. probably reducing profit & potentially dividends if they split .. ;)

[BlackPeter]

https://www.pdn.ac.lk/purse/Proceedings/2011/it/it_7.pdf Excerpt

Not sure it is important enough to me :):, but on face value I wonder whether the authors benefitted from the NZ Maths education which is now the worst any first world country can offer :p:


According to the analyses, 54% of companies recorded an increment of trading
volume after the stock split regardless of length of the data frame

so - what happened with the other 46% of all companies?


, and the trading volume increased significantly in 60% of companies.

what's the difference between "increment in trading volume" which hit 54% of all companies and "trading volume significantly increased" which hit apparently 60% of all companies? Even if they use two different bars ... wouldn't it make sense if the higher bar ("significantly") is hit less often?


From a total of 26 companies, 65% and 62%
of companies have increased their market price and number of trading respectively


And now its 65% and 62% - hmm ... Looking at the sample size though, I wonder whether all of this is statistically relevant anyway ...

But be that as it may ... I recon this is the same thing as any hype about ASX listings - if you want to believe in it as magic bullet, than it works - at least until your fire the rifle ;p - and hey - sometimes people would hit the target with or without magic ... and whatever it is it generates PR (i.e. short term hype).

On the other hand - if splitting the shares is such a safe method to rise the market cap ... why don't we have zillions of shares for any company? Just keep splitting the shares and the market cap just keeps rising. That's how everybody gets a bargain :);

[winner69]

BP ...maybe the author fits this (courtesy of BaaBaa last night)

There are two types of people in the world
1) Those that can extrapolate from incomplete information

[Beagle]

Bp, ackowdge that was a small study but I think the study I referenced at #6087 provides compelling evidence. Two studies of 1000 companies. I think its a good idea but ultimately I am sure the Chairman will be far more interested in what Tim Glasson thinks :cool:

I do note however that no-one has referenced any actual studies confirming that a share split is a waste of time so in the absence of any decent sample size confirming its a waste of time I'm happy to accept the study I referenced at face value.

I suspect, (but have no studies to confirm this), that some retail investors won't buy a $7+ share because they think something under $2 gives them far more bang for their buck.

[winner69]

From beagle earlier -

Although stock splits have no affect on the intrinsic value of the stock, being basically cosmetic, many studies show that stock splits result in high performance. In two separate studies in1996 and in 2003, David Ikenberry, Chairman of the Finance Department at the University of Illinois at Urbana-Champaign, found price performance of split stocks outperformed the market by 8 percent during the year following the split and by 12 percent over the ensuing three years. He looked at over 1,000 stocks for each study, including 2-for-1, 3-for-1 and 4-for-1 stock splits".

I remember reading a similar paper which drew the same conclusion ....but also noted that those stocks that outperformed the market post-split had also outperformed the market pre-split ....also suggesting that the (out performing) price increases pre-split had prompted the stock split. Sort of saying the split didn’t really have much real impact at all

Whatever HLG closed at 770 today .....possibly 800 tomorrow

[James108]

I’d prefer no share split only because it makes annual reports and past analysis just a bit more annoying. Not too fussed if other investors buy this or not tbh.

[winner69]

Beagle keeps on about he huge growth in Glassons AU and how this makes HLG a growth company

So had a look at Glassons AU sales over the years

Impressive stuff

[Beagle]

Beagle keeps on about he huge growth in Glassons AU and how this makes HLG a growth company

So had a look at Glassons AU sales over the years

Impressive stuff

Sure is mate, lovely image, thanks for sharing. I am sure Tim Glasson feels very proud of the excellent work his son is doing over there.
Another new all time high and I am very confident there will be many more to come :)

[Rawz]

Beagle keeps on about he huge growth in Glassons AU and how this makes HLG a growth company

So had a look at Glassons AU sales over the years

Impressive stuff

That is a beautiful chart to look at. Especially when considering the size of the market and how little penetration they have. That CAGR could comfortably go on for another 5 years

[Beagle]

That is a beautiful chart to look at. Especially when considering the size of the market and how little penetration they have. That CAGR could comfortably go on for another 5 years

Agreed and that would lead to annual sales in Au of around $330m 5 years hence and the market penetration level would still be materially lower than in N.Z.
Huge opportunity for many years of strong growth that some people are completely overlooking.

[winner69]

That is a beautiful chart to look at. Especially when considering the size of the market and how little penetration they have. That CAGR could comfortably go on for another 5 years

As beagle says Glassons AU and NZ sales are much the same yet AU market about 6 times bigger than NZ

Knock off a bit for them no going to Perth or Darwin that still leaves potential opportunity of another 300m/400m of growth in the future if they did as well over there as in NZ

[Balance]

As beagle says Glassons AU and NZ sales are much the same yet AU market about 6 times bigger than NZ

Knock off a bit for them no going to Perth or Darwin that still leaves potential opportunity of another 300m/400m of growth in the future if they did as well over there as in NZ

Man just have to get more when market opens tomorrow.

[Beagle]

As beagle says Glassons AU and NZ sales are much the same yet AU market about 6 times bigger than NZ

Knock off a bit for them no going to Perth or Darwin that still leaves potential opportunity of another 300m/400m of growth in the future if they did as well over there as in NZ

Oh my goodness, we could be talking about a company selling ~ $600m a year in five years time compared to just $220m a few years ago. Huge growth opportunity and on a current year PE of just over 10. Hmmm...HLG, you can't have too many :t_up:

Now at 17% :blush: and worse still, I am strongly inclined to buy more !! Maybe when there's really serious money to be made one just throws away the rule book ?...or comes up with a more creative interpretation :sneaky2:

“ Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.” 7 is 14.3% but it's notable that nowhere in there does it say divide your portion "equally" into seven or eight. I think I might have talked myself into thinking 20% is okay for really high conviction stocks. Seems to work more than okay for Kingfish !

[Balance]

Oh my goodness, we could be talking about a company selling ~ $600m a year in five years time compared to just $220m a few years ago. Huge growth opportunity and on a current year PE of just over 10. Hmmm...HLG, you can't have too many :t_up:

Now at 17% :blush: and worse still, I am strongly inclined to buy more !! Maybe when there's really serious money to be made one just throws away the rule book ?...or comes up with a more creative interpretation :sneaky2:


17%?

Try 35%. :eek2:

[winner69]

Forsythe Barr guy on to it ...in today’s Herald

Hallenstein Glasson had a strong day, rising 37c or 5.05 per cent to $7.70. Stratful said the retail sector is a shining example of the recovery in the economy, reflecting the strong spending by consumers who can't travel overseas.

[Balance]

Forsythe Barr guy on to it ...in today’s Herald

Hallenstein Glasson had a strong day, rising 37c or 5.05 per cent to $7.70. Stratful said the retail sector is a shining example of the recovery in the economy, reflecting the strong spending by consumers who can't travel overseas.

He did not mention the 10%+ yield?

Well, better buy more before one of them let that cat out off the bag! :eek2:

[Balance]

That’s what keeps it interesting, like now when the SP is bashing against its historical high prices and selling (resistance) volume increasing.

Keeping a close eye on the chart to assess market sentiment is important right now, this might make 30-40 cents return, but it can lose way more than that in capital, virtually in a heart beat.

Heck it was $1.80 this year!!! So a great ride for any one since then, but fact is it’s at previous sentiment high and people calling for another 50-100 cents based purely on FA are imo optimistic.

That call alone, for SP appreciation, points to capital sensitivity (motivation for holding at a high price) like it’d be Great if the SP goes up but if it doesn’t I can reconcile my position with the earnings. Watch that sentiment get tested when the SP turns down again. Those sentiments run for the hills.

That’s ok but they’re also the ones who’ll be first at the exit if resistance prevails and a new sentiment down sets in. I do not see any long term committed investors here who can stomach the volatility in capital purely for earnings. Not one. I’m sure they exist, but not here talking us into believing the upside is inevitable and volatility will miraculously go away forever.

Momentum traders love a dividend while they’re holding, it’s cream on top of capital gains, but momentum is what takes them out as fast as it got them in. Regardless of the narrative surrounding their position, they’re very very good momentum traders, happy to take a bonus dividend feed or two along the way.

TA says... nah, it’s flashing in big bold letters CAUTION ⚠️ Stay alert.

Caution from Baa_Baa on 17 Nov 2020.

Sp then was $6.47 (cum 24 c dividend).

Guess who purposely bought more on that caution & alert? :t_up:

[tim23]

gee if they paid say 50c a share then a 5% net yield gets us near $10, me holding.

[HCR20]

Oh my goodness, we could be talking about a company selling ~ $600m a year in five years time compared to just $220m a few years ago. Huge growth opportunity and on a current year PE of just over 10. Hmmm...HLG, you can't have too many :t_up:

Now at 17% :blush: and worse still, I am strongly inclined to buy more !! Maybe when there's really serious money to be made one just throws away the rule book ?...or comes up with a more creative interpretation :sneaky2:

“ Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.” 7 is 14.3% but it's notable that nowhere in there does it say divide your portion "equally" into seven or eight. I think I might have talked myself into thinking 20% is okay for really high conviction stocks. Seems to work more than okay for Kingfish !

Can you make other changes to your portfolio to balance out the risk a little?

[Beagle]

Can you make other changes to your portfolio to balance out the risk a little?

Thanks for the thought. Pretty happy with portfolio allocations.

[nztx]

Oh my goodness, we could be talking about a company selling ~ $600m a year in five years time compared to just $220m a few years ago. Huge growth opportunity and on a current year PE of just over 10. Hmmm...HLG, you can't have too many :t_up:

Now at 17% :blush: and worse still, I am strongly inclined to buy more !! Maybe when there's really serious money to be made one just throws away the rule book ?...or comes up with a more creative interpretation :sneaky2:

“ Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.” 7 is 14.3% but it's notable that nowhere in there does it say divide your portion "equally" into seven or eight. I think I might have talked myself into thinking 20% is okay for really high conviction stocks. Seems to work more than okay for Kingfish !


Slightly north of 25% here & a happy camper still looking .. ;)

One of those goooood ones you can never have too many of ..

[FatTed]

21% hlg, 17% brm, 15% oca , 12% spk (not sure why its not in capitals)

[winner69]

ABS (Oz Stats outfit) released December month retail sales for Australia yesterday

Their commentary had this - not so good reading:

Clothing, footwear and personal accessory retailing

Clothing, footwear and personal accessory retailing fell 9.4% in December, in seasonally adjusted terms.

By industry subgroup, the seasonally adjusted estimate:

- fell 9.3% for Clothing retailing.
- fell 9.7% for Footwear and other personal accessory retailing.

[Beagle]

Glassons no doubt picked up heaps of extra market share from other clothing retailers going bankrupt earlier in the year due to covid so there's no worries.

[Waltzing]

Yes the data was interesting wasnt it :ohmy:.. one of our guys ran some access to this web site and found it down and out, pings were working .. back up now?

going to miss it , there is nothing like local knowledge.

[Beagle]

Yes the data was interesting wasnt it :ohmy:.. one of our guys ran some access to this web site and found it down and out.. back up now?

Yeap, for once I got some real work done lol

[nztx]

% of NZ Portfolio Net Gain (Loss) by Co roughly to date here -

Net Cash Divs, realised & unrealised gains included

HLG +53.0%
HGH +14.5%
NWF +8.5%
TRA +8.5%
BGP + 7.3%
SKL + 4.8%
WHS +3.3%
NZO -6.1%
SKT -3.2%
ATM -2.7%
SCY -2.6% (W/o)
AIR -2.3%

The rest (incl losses & w/offs) Net + 17.0%

[Beagle]

ABS (Oz Stats outfit) released December month retail sales for Australia yesterday

Their commentary had this - not so good reading:

Clothing, footwear and personal accessory retailing

Clothing, footwear and personal accessory retailing fell 9.4% in December, in seasonally adjusted terms.

By industry subgroup, the seasonally adjusted estimate:

- fell 9.3% for Clothing retailing.
- fell 9.7% for Footwear and other personal accessory retailing.

And yet this paints a far more rosy picture https://thebull.com.au/biggest-lift-in-spending-in-12-years/?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+6+ February+2021

Excerpt “At a national level, clothing, footwear and personal accessory retailing (18.1 per cent), and cafes, restaurants and takeaway food services (10.4 per cent), led the rises in seasonally adjusted volume terms. Hard to make sense of statistics sometimes...I suppose its how one interprets them.

I am REALLY looking forward to the trading update and profit forecast, maybe as early as this coming week ?

[winner69]

And yet this paints a far more rosy picture https://thebull.com.au/biggest-lift-in-spending-in-12-years/?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+6+ February+2021

Excerpt “At a national level, clothing, footwear and personal accessory retailing (18.1 per cent), and cafes, restaurants and takeaway food services (10.4 per cent), led the rises in seasonally adjusted volume terms. Hard to make sense of statistics sometimes...I suppose its how one interprets them.

I am REALLY looking forward to the trading update and profit forecast, maybe as early as this coming week ?

That 18.1% you highlighted is for the Dec Quarter v September (interesting that September quarter increase was 35.5%)

And I note Bull did say for December month sector was down 9.4%

Quarter may have looked good but appears as if things might be slowing (in seasonally adjusted terms)

Just as well HLG don't report sales in seasonally adjusted terms

[King1212]

Got to be fair the sales down...one can only buy so much clothing.... people don't change it like toilet paper

[winner69]

Several reports use seasonally adjusted numbers

I prefer using actual dollars and comparing to prior corresponding period - ie month v same month a year prior

Below are the actual numbers

Look for what you want to see


My insight - things are looking better but still a long way to get to pre covid sales levels

[Beagle]

Thanks mate, clears it up. Against that backdrop when the company last updated shareholders at the annual meeting on the first 18 weeks trading performance, sales were up 14.51% and they said :-
TRADING OUTLOOK
Finally, in summary the trading outlook.
We are pleased with trading year to date....
We are particularly pleased with the growth for Glassons in Australia, and this remains a key growth opportunity for the business....

I think what we can conclude is that in Australia Glassons is making very good market share gains and is increasing recognized by Australian consumers as a desirable brand.

[winner69]

“Where did that huge ‘cash mountain’ go?” we possibly be asking when the cash balance at end of January is back to more normal levels.

Suppose we will have to wait until they publish their half year financials before we can answer that question.

[Balance]

https://www.nzherald.co.nz/business/what-to-expect-this-earnings-season/T2FKB2RWW7U5WDN3XAYI5D5IMY/

paywalled

What to expect this earnings season when NZX companies report next week?

"Retailers and building sector businesses are expected to provide bright spots in the upcoming reporting season while tourism and border exposed businesses continue to do it tough."

"They have just had an unbelievable amount of stimulus benefit from the general economy but the more open question with them is just have they got enough stock to keep it all going?"

[Balance]

deleted repeat repeat

[Beagle]

https://www.nzherald.co.nz/business/what-to-expect-this-earnings-season/T2FKB2RWW7U5WDN3XAYI5D5IMY/

paywalled

What to expect this earnings season when NZX companies report next week?

"Retailers and building sector businesses are expected to provide bright spots in the upcoming reporting season while tourism and border exposed businesses continue to do it tough."

"They have just had an unbelievable amount of stimulus benefit from the general economy but the more open question with them is just have they got enough stock to keep it all going?"

Better make a comment now in case the website goes down again. (Thanks to the admin team and Vince for your very hard work getting it back up and running)
Couple of things.
Firstly, the trading update will be any day now and I am expecting a very strong update and forecast for the first half

Secondly on the question of "how much of the profit gain will be in respect of a one-off Covid bounce-back spending phenomenon" ? Looking at the detail of the Australian apparel retail data Winner kindly posted recently, unless I am misreading the data it looks like there has been little if any bounce-back in apparel in Australia. By extension one could conclude the detail here is very similar so I would propose that the vast majority of the strong growth about to be reported is genuine market share gain and not a one-off.
One-off spending gains is certainly happening in some sectors like home renovation, no argument about that, but for apparel, not nearly so much if any.

[Balance]

Better make a comment now in case the website goes down again. (Thanks to the admin team and Vince for your very hard work getting it back up and running)
Couple of things.
Firstly, the trading update will be any day now and I am expecting a very strong update and forecast for the first half

Secondly on the question of "how much of the profit gain will be in respect of a one-off Covid bounce-back spending phenomenon" ? Looking at the detail of the Australian apparel retail data Winner kindly posted recently, unless I am misreading the data it looks like there has been little if any bounce-back in apparel in Australia. By extension one could conclude the detail here is very similar so I would propose that the vast majority of the strong growth about to be reported is genuine market share gain and not a one-off.
One-off spending gains is certainly happening in some sectors like home renovation, no argument about that, but for apparel, not nearly so much if any.

Good point, Beagle.

And the fashion industry is about brand & the perception of the brand with its target market.

Glassons appears to be scoring very very well on that front in its growth market of Australia.

[Greekwatchdog]

H & M to close seven stores across Aust. https://www.nzherald.co.nz/business/fashion-giant-hm-to-close-seven-stores-across-australia/K4AU3ZWWPVRFHA5OCRFNVPN3WE/

[Beagle]

Good point, Beagle.

And the fashion industry is about brand & the perception of the brand with its target market.

Glassons appears to be scoring very very well on that front in its growth market of Australia.

Exactly Balance and I think in that regard their first sustainability report this year is a good initiative in helping customers identify with the values of the brand from an ESG point of view.
Customers who feel the brand is sensitive to the environment, the fit, style, quality and feel of the fabric is nice and who believe the clothes are a fair price will be repeat customers.

HLG a classic under the radar stock with a strong multi year track record of growth in Australia, growth that people are paying nothing for because the current forecast FY21 PE on an estimated eps of 74 cps is just 10.3 which is less than a no growth PE in this current interest rate environment. (Fair no growth PE for any stock at present is 11 in my opinion)

[LaserEyeKiwi]

H & M to close seven stores across Aust. https://www.nzherald.co.nz/business/fashion-giant-hm-to-close-seven-stores-across-australia/K4AU3ZWWPVRFHA5OCRFNVPN3WE/

Interesting they are so far behind brands such as Glassons that already have established online channels in Australia. Consolidation in the industry should benefit Glassons one would think, maybe even an opportunity to take over one or two of the attractive lease locations.

[winner69]

Beagle, so is -

"To build a sustainable business on a firm foundation of integrity - (People, Planet, Product)"

the same conceptually as -

"Doing milk differently for a healthier world"

Seems to me that you now think that ESG things are important.

[Beagle]

Some companies like HLG find a nice balance with ESG matters.

[Ferg]

“Where did that huge ‘cash mountain’ go?” we possibly be asking when the cash balance at end of January is back to more normal levels.

Suppose we will have to wait until they publish their half year financials before we can answer that question.

A good question. From memory, quite a lot of that cash pile came from the deferral of supplier payments so some of it was due to timing.

[Balance]

A good question. From memory, quite a lot of that cash pile came from the deferral of supplier payments so some of it was due to timing.

Firstly, HLG deferred the dividend payment to Dec 2020 so that's $14.3m.

Then, there was a higher than 2019 suppliers/creditors' balance (on like for like sales level) of $6m.

So the cash balance from 1 August 2020 will be down to around $30m but, with the H1 2021 profit & cashflow, will be back to at least $50m again on 1 March 2021.

[Beagle]

Drilling a little deeper into their very robust cash position they actually paid 2 dividends in recent months, total of 39 cps = $23.2m since the last balance date. I think they will make around that for the current period therefore so far we're still at ~ $50m cash as at 01/02/21.

I think its highly likely supplier payment terms will remain ostensibly very similar to what they were as at the last balance date so I don't expect a change there.

They're on record as taking a very conservative approach to new store openings / refurbishment and capex in general, (concentrating their efforts on digital), so I expect that depreciation, (a non cash charge of something like ~ $6m per half "from memory") in the current half will be materially higher than cash expended on capex.

I therefore remain very comfortable that cash on hand will be somewhere around $50m as at the pending interim reporting date, possibly several million more. I expect they will be in a position to pay HUGE fully imputed dividends going forward of not less than 50 cps annually = ~ 70 cps gross = 9% gross yield with the next big dividend likely to be paid in April 2021.

$50m cash on hand with no debt = 83 cps = an extremely robust financial position.

[winner69]

The Cash Flow rec at end of July has for H220 this thing - Increase in Creditors $16m (from 6 months earlier) - unpaid bills?

Apparently at the ASM somebody asked about the huge cash mountain and was told that their offshore suppliers had provided deferred settlement terms which had been since been reinstated to normal terms (in other words the cash had a home)

[winner69]

Doesn't really matter how much cash they have they'll pay a decent dividend - Tim and his mates will see to that -- and there's the old 'supported by a strong balance sheet' trick

[winner69]

They're on record as taking a very conservative approach to new store openings / refurbishment and capex in general, (


Hope they not too conservative - need to invest to keep that growth up in Australia

Otherwise might stagnate - time to invest when competitors are struggling

[toml.1234]

In an email early this AM:

We’re running virtual customer feedback sessions to hear what you think of our brand, products and the experiences you’ve had with us.

These are 40-minute sessions where we ask for the great and less great experiences you’ve had, after that… a $100 Hallensteins voucher is all yours!

I personally haven't been a fan of the hallensteins brand over the years, view it as pretty well warehouse quality, however with popular/trendy designs/prints to mask the quality. Kept me from buying shares for a long time due to my personal disliking however bit the bullet, buying in a couple weeks back. Onwards & upwards!

[winner69]

In an email early this AM:

We’re running virtual customer feedback sessions to hear what you think of our brand, products and the experiences you’ve had with us.

These are 40-minute sessions where we ask for the great and less great experiences you’ve had, after that… a $100 Hallensteins voucher is all yours!

I personally haven't been a fan of the hallensteins brand over the years, view it as pretty well warehouse quality, however with popular/trendy designs/prints to mask the quality. Kept me from buying shares for a long time due to my personal disliking however bit the bullet, buying in a couple weeks back. Onwards & upwards!

Do that focus group mate ... and put the $100 inot more shares ...it'll keep on giving

[toml.1234]

Yep have signed up for it mate. Perhaps I could ask for $100 of shares rather than product!

[macduffy]

Do that focus group mate ... and put the $100 inot more shares ...it'll keep on giving

Probably a merchandise voucher - for socks and undies and suchlike!

:)

[Balance]

Probably a merchandise voucher - for socks and undies and suchlike!

:)

Could be 10 shares by end of March!

[Rawz]

In an email early this AM:

We’re running virtual customer feedback sessions to hear what you think of our brand, products and the experiences you’ve had with us.

These are 40-minute sessions where we ask for the great and less great experiences you’ve had, after that… a $100 Hallensteins voucher is all yours!

I personally haven't been a fan of the hallensteins brand over the years, view it as pretty well warehouse quality, however with popular/trendy designs/prints to mask the quality. Kept me from buying shares for a long time due to my personal disliking however bit the bullet, buying in a couple weeks back. Onwards & upwards!

Welcome to the party Toml. As an owner I bet youll find yourself buying and loving Hallensteins clothing really soon :)

[Waltzing]

wish holders all the best.

[winner69]

Just for Beagle

Glassons market share trends. De facto market is clothing sector retail sales for Eastern States (ex ABS)

Anybody know store numbers over this period?

[Rawz]

Just for Beagle

Glassons market share trends. De facto market is clothing sector retail sales for Eastern States (ex ABS)

Anybody know store numbers over this period?

What a graph! Just a wee bit of room for growth..

[Beagle]

The Cash Flow rec at end of July has for H220 this thing - Increase in Creditors $16m (from 6 months earlier) - unpaid bills?

Apparently at the ASM somebody asked about the huge cash mountain and was told that their offshore suppliers had provided deferred settlement terms which had been since been reinstated to normal terms (in other words the cash had a home)

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/362283/333885.pdf
Page 27 - Trade payables FY19 $6,798, FY20 $12,771, difference $5,973K.

Nice image above, thanks.

On the depreciation non cash thing, this was $9,816K last year (not including the new right of use asset stuff), so about $5m expense to be recorded this present half for what is a non cash item, (a little less than the $6m I estimated earlier today).

[winner69]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/362283/333885.pdf
Page 27 - Trade payables FY19 $6,798, FY20 $12,771, difference $5,973K.

Nice image above, thanks.

On the depreciation non cash thing, this was $9,816K last year (not including the new right of use asset stuff), so about $5m expense to be recorded this present half for what is a non cash item, (a little less than the $6m I estimated earlier today).

Cash Flow Statement and reconciliation to profit paints a different story


Less than 1% market share highlights potential ...probably about 3% share in Nz

[Beagle]

Cash Flow Statement and reconciliation to profit paints a different story


Less than 1% market share highlights potential ...probably about 3% share in Nz
I believe we have had this discussion before. The bottom line is that all liabilities as at balance date on whatever terms must correctly be recorded in the balance sheet and trade payables are up just $5.973m and this was funding $626K more inventory so my calculation of the net effect of the change in payment terms is $5,973K - $626K = $5,347K.

[winner69]

Wonder what the $14.253m that pops up on the Cash Flow part is then. I've always assumed this is the cash benefit of a higher level of unpaid bills. I see on the Cash Flow Statement that payments to suppliers were about $34m less than pcp

Significant piece of the much improved cash flow in F20


Willing to learn

[Beagle]

Yeah I noticed that too mate. Bottom line is trade payables for which they are liable absolutely must be recorded in the balance sheet so the change between years noted above is how I see it but I haven't looked into or tried to reconcile the difference. One clue could be that the figure you've highlighted includes employee benefits. I guess there could be other things in there too ?
Not too fussed about it to be honest because there is no doubt whatsoever they are in an extremely strong financial position and are very well placed to pay very high level's of fully imputed dividends going forward, (which if my memory serves me correctly is why you and I backed the truck up in the first place at ~ $2.75 in August 2016)....don't think you or I ever expected to more than triple our money inclusive of dividends in little more than 4 years. Oh my goodness, what a ride its been and plenty more fun to come !!!

[nztx]

How about seasonal changes & accounting for restocking coming out of Covid-19
accounting for payables variance - perhaps added stocks for what may have been
a bumper next HY ? Maybe delayed summer indent / inventory following C-19 ?

I'm not sure how much they would have to shell out upfront but deferred LC settlement
say 60D or 90D out on bumper buy ins may be enough as demand for volume starts ramping up..
Okay and then there's duty & GST - presumably on deferred account for August I presume
due 28th Sep -- again on bumper incoming goods too..

Through lock down they may have destocked to operate on minimal optimum Qty's just
to stay operating & perhaps online, then the gates open with Summer gear starting to really run

Why part with cash upfront unnecessarily for stock when trade terms may have no added cost
for a free ride ? ;)

Offshore suppliers may be late delivering dependent on how they were or are affected by C-19 too - who knows ..
With shipping - possibly big delays there, delays in clearing once it hits our border gates in 40 foot boxes too

The amount of gear to fill HLG warehouses & shops wouldn't be small .. smoothly moving is one thing but
bunching up likely distorts financials especially bridging a very near balance date ..

[Beagle]

Very experienced management team to handle all the above and navigate the challenges. I'm feeling very relaxed and excited at the same time about the imminent trading update which will hopefully be forthcoming in the next week or so.

[winner69]

Aussie consumers on a high

Westpac Consumer Confidence Survey

This increase in the Index has recouped around half the loss we saw in January when the Index fell from 112.0 in December to 107.0.

Recall that the December print was a ten year high so the bounce-back in February signals that the consumer remains extraordinarily confident.

https://westpaciq.westpac.com.au/Article/46714/53404/

[Habits]

Bought last two days at 7.58 and 7.66 thinking wow the price is down and i bagged a bargain... duh... then I twigged the price is up a dollar actually from the 6.70 last time I bought HLG. Oh well the price popped a few cents higher in the afternoon and I am still very happy with HLG as these are trending on good earnings and divvie.

Longterm Holder

[gbogo]

Bought last two days at 7.58 and 7.66 thinking wow the price is down and i bagged a bargain... duh... then I twigged the price is up a dollar actually from the 6.70 last time I bought HLG. Oh well the price popped a few cents higher in the afternoon and I am still very happy with HLG as these are trending on good earnings and divvie.

Longterm Holder

haha! "always check the big figure". one of the first lessons I was taught as a trader..)

[winner69]

Bought last two days at 7.58 and 7.66 thinking wow the price is down and i bagged a bargain... duh... then I twigged the price is up a dollar actually from the 6.70 last time I bought HLG. Oh well the price popped a few cents higher in the afternoon and I am still very happy with HLG as these are trending on good earnings and divvie.

Longterm Holder

In a few months you’ll be saying bought some more 8.70 thinking price was down and then twig you bought last lot at 7.66

Going to be hard to keep up with the rises

[Balance]

In a few months you’ll be saying bought some more 8.70 thinking price was down and then twig you bought last lot at 7.66

Going to be hard to keep up with the rises

After Australia, I believe there is a strong case for Glassons to open up in Asian capitals like Tokyo, Shanghai, Hong Kong and Singapore. The brand has appeal imo beyond Australasia but HLG needs to be very careful & strategic as to how to roll out its offering over there.

[BlackPeter]

After Australia, I believe there is a strong case for Glassons to open up in Asian capitals like Tokyo, Shanghai, Hong Kong and Singapore. The brand has appeal imo beyond Australasia but HLG needs to be very careful & strategic as to how to roll out its offering over there.

Not sure - thoughts like that created bid dents in the pockets of many NZ shareholders. Just being successful in a globally small niche market like NZ or ANZ does not guarantee success on the global stage. Too many companies to mention here who thought that their relative domestic success guarantees them a win on the big stage as well.

While not holding - I think I would prefer a solid, sustainable and successful ANZ company to just another firecracker trying to reach the stratosphere but running out of puff.

Conditions out there are different. Different cultures, different tastes, different working conditions - and plenty of 500 pound gorillas out there who know their home patch already. What makes you think that Asian consumers would be more attracted by Hallensteins or Glassons than by the big brands of the world?

[Balance]

Not sure - thoughts like that created bid dents in the pockets of many NZ shareholders. Just being successful in a globally small niche market like NZ or ANZ does not guarantee success on the global stage. Too many companies to mention here who thought that their relative domestic success guarantees them a win on the big stage as well.

While not holding - I think I would prefer a solid, sustainable and successful ANZ company to just another firecracker trying to reach the stratosphere but running out of puff.

Conditions out there are different. Different cultures, different tastes, different working conditions - and plenty of 500 pound gorillas out there who know their home patch already. What makes you think that Asian consumers would be more attracted by Hallensteins or Glassons than by the big brands of the world?

I agree with you about the need to be circumspect about any NZ company opening up in Asia or for that matter, overseas.

Hence, the need to be very careful and strategic as to any openings in Asia. As a first step, you do so with a local partner there and try out the market.

We have seen the likes of Pumpkin Patch enjoyed initial overseas success and then flushed with that success, went nuts and bet the farm & lost the farm with multiple openings overseas. Bad decision and bad move.

[winner69]

After Australia, I believe there is a strong case for Glassons to open up in Asian capitals like Tokyo, Shanghai, Hong Kong and Singapore. The brand has appeal imo beyond Australasia but HLG needs to be very careful & strategic as to how to roll out its offering over there.

Let them conquer Australia first

Maybe not conquer but at least get a decent presence ....currently they really are a non event over there.

[Beagle]

Well done Stuart - give that man a rise



4/2/2021 - Hat tip to you mate, just been promoted to CEO. You clearly have amazing prediction skills.
Remind me again, where you see the shares in 12 months time ? https://www.nzx.com/announcements/367384

[Rawz]

Not sure - thoughts like that created bid dents in the pockets of many NZ shareholders. Just being successful in a globally small niche market like NZ or ANZ does not guarantee success on the global stage. Too many companies to mention here who thought that their relative domestic success guarantees them a win on the big stage as well.

While not holding - I think I would prefer a solid, sustainable and successful ANZ company to just another firecracker trying to reach the stratosphere but running out of puff.

Conditions out there are different. Different cultures, different tastes, different working conditions - and plenty of 500 pound gorillas out there who know their home patch already. What makes you think that Asian consumers would be more attracted by Hallensteins or Glassons than by the big brands of the world?

100% agree.

[LaserEyeKiwi]

Let them conquer Australia first

Maybe not conquer but at least get a decent presence ....currently they really are a non event over there.

I agree - stick to Australia which is a huge blue ocean, and maximise the already made logistics/fulfilment investment. I would rather they add additional product offerings in NZ/AUS (a new footwear offering, maybe some online subscription service) rather than expanding overseas. Buying into/acquiring Allbirds would be a dream scenario though (although that means being in the US/global market all of a sudden).

[winner69]

Card Spend in NZ Apparel sector for January from Stats NZ

Apparel for month up 5.5% on last year - good

For those who prefer seasonally adjusted numbers apparel was down 2.0% on December - not good

[Beagle]

Market penetration in Australia is growing nicely but is still only about one sixth of what it is here so there's huge scope for the ongoing strong growth they've enjoyed there to continue for the foreseeable future. HLG has been around since 1947, (NZX's oldest listed company) and that longevity has been built on taking a very well managed and prudent approach to managing the opportunities and commercial risks they face and I have every confidence they will continue to take a well balanced and very prudent approach with their growth aspirations and plans going forward. Young Glasson growing the Australian Glasson operations doesn't have to look very far for a top business mentor does he and Tim Glasson with his 20% stake has his owners eye clearly focused on the business :)

How's plans for that 5:1 share split coming along Tim ?

[BeeBop]

After Australia, I believe there is a strong case for Glassons to open up in Asian capitals like Tokyo, Shanghai, Hong Kong and Singapore. The brand has appeal imo beyond Australasia but HLG needs to be very careful & strategic as to how to roll out its offering over there.

To be a Negative Nelly...many expansions off-shore have not worked. A specific example was PPL, the stores in NZ looked great but the one I went to the the Middle East was just like an outlet. There was no messaging reach, no real 'sales-person' work going on....and then another example from a very very large NZ corporate with not enough on-the-ground responsibility led to a real disaster. Any major expansion sends shivers up my spine now.

[koko90]

Glassons or Hallensteins would never work in a market like any of those Asian capitals you listed. It is all about luxury fashion brands over there and they already have plenty of well established low cost alternatives like Uniqlo, Zara and H&M. And Tokyo is on another level...

[BeeBop]

Glassons or Hallensteins would never work in a market like any of those Asian capitals you listed. It is all about luxury fashion brands over there and they already have plenty of well established low cost alternatives like Uniqlo, Zara and H&M. And Tokyo is on another level...

Agree absolutely...NZ has its own fashion style....much of it that won't work off-shore...brands matter more.

[Balance]

If MyFoodBag IPO multiples are anything to go by, HLG has simply got to be the bargain of the decade on the NZX by comparison!

If anyone is prepared to invest in this IPO at the sort of multiples (high enterprise multiple, humongous PER & just about all goodwill on the balance sheet) being asked and scratchy pro-forma financial information being provided, I would suggest that there's plenty more value in the market already in some of the proven performing stocks.

EBITDA X F21 16.7X F22 13.9X
PER 28.7X 22.4X

[peat]

If MyFoodBag IPO multiples are anything to go by, HLG has simply got to be the bargain of the decade on the NZX by comparison!

If anyone is prepared to invest in this IPO at the sort of multiples (high enterprise multiple, humongous PER & just about all goodwill on the balance sheet) being asked and scratchy pro-forma financial information being provided, I would suggest that there's plenty more value in the market already in some of the proven performing stocks.

EBITDA X F21 16.7X F22 13.9X
PER 28.7X 22.4X

And such a LOT more risk ! I mean I know MFB's been running a few years but these things come and go a bit. There is a lot higher chance of MFB either facing a new competitor that can really compete or of them screwing up one way or another than there is from the longest listed company on the NZX.

[Beagle]

Yes...I think you two gentlemen have summed that up very nicely.

I'm really looking forward to next week when they give their trading update and profit forecast.

[winner69]

Hopes of NZX inclusion .........they say My Food Bag maybe ahead of them in the queue now

That’s quite funny really

[Greekwatchdog]

Liquidity will always be an issues with HLG. Sooner or later it will get in just depends if you are in if HLG get inclusion to get some bonus value. Do management care about inclusion? My Food Bag will be all dressed up for Sharesies Crowd and Mum and Dad investors with lots of gimmicky marketing. Nadia appeals!!

[Balance]

Liquidity will always be an issues with HLG. Sooner or later it will get in just depends if you are in if HLG get inclusion to get some bonus value. Do management care about inclusion? My Food Bag will be all dressed up for Sharesies Crowd and Mum and Dad investors with lots of gimmicky marketing. Nadia appeals!!

And these days, IPOs like MFB do not even need to issue a full prospectus containing all the pertinent financial information - just a Product Disclosure Statement with all the glossy photos, fancy graphics and imo, misleading information about future growth etc etc.

Never mind the fact that goodwill represents 80% of its assets! And that’s nowhere to be seen!

Oh well, we will stick to the true and tried with a long history of outstanding performances.

[winner69]

Liquidity will always be an issues with HLG. Sooner or later it will get in just depends if you are in if HLG get inclusion to get some bonus value. Do management care about inclusion? My Food Bag will be all dressed up for Sharesies Crowd and Mum and Dad investors with lots of gimmicky marketing. Nadia appeals!!

Management probably don’t care a stuff whether they are in the NZX50 or not

[Balance]

Management probably don’t care a stuff whether they are in the NZX50 or not

And in a way, as long as they keep performing, it does not really matter.

We have seen Meridian & Contact get the indexing blues - go up like a rocket and dropping like a stone!

[winner69]

And in a way, as long as they keep performing, it does not really matter.

We have seen Meridian & Contact get the indexing blues - go up like a rocket and dropping like a stone!

Yep, just them get on with making money

[nztx]

Management probably don’t care a stuff whether they are in the NZX50 or not


Liquidity issues can be good insurance too -- just short of 60 mil shares issued will only go so far
then demand does the rest .. ;)

[nztx]

If MyFoodBag IPO multiples are anything to go by, HLG has simply got to be the bargain of the decade on the NZX by comparison!

If anyone is prepared to invest in this IPO at the sort of multiples (high enterprise multiple, humongous PER & just about all goodwill on the balance sheet) being asked and scratchy pro-forma financial information being provided, I would suggest that there's plenty more value in the market already in some of the proven performing stocks.

EBITDA X F21 16.7X F22 13.9X
PER 28.7X 22.4X


Yes .. not wrong there .. far better fish to fry elsewhere forgetting the hyped up MFB's of this world .. ;)

[Beagle]

https://www.glassons.com/

I see they have specific Glassons website for N.Z. Australia the U.S. and international now. Hmmm... Smart move expanding their digital footprint.

[lissica]

Glassons or Hallensteins would never work in a market like any of those Asian capitals you listed. It is all about luxury fashion brands over there and they already have plenty of well established low cost alternatives like Uniqlo, Zara and H&M. And Tokyo is on another level...

Hallensteins have a lot of work to do if they expand into Asia. Their clothes are all sized/styled for tall/overweight Euro/Maori/Pac Island demographic.

[Habits]

For a lot of foreigners a holiday to NZ is the pinnacle... now that people are not traveling and our borders are closed then what better opportunity to produce and sell products online to them. A little slice of kiwi delivered :) would have to be genuine nz made with the "made in nz" logo.

[Snoopy]

For a lot of foreigners a holiday to NZ is the pinnacle... now that people are not traveling and our borders are closed then what better opportunity to produce and sell products online to them. A little slice of kiwi delivered :) would have to be genuine nz made with the "made in nz" logo.


Erm, I hate to shatter some illusions here. But do Hallensteins make anything in New Zealand anymore? The Sustainability Report talks about contracting factories in China, India and Bangladesh.

SNOOPY

[Waltzing]

Detective Inspector SNOOP is on the job.

In "Bangladesh" the model for manufacture is ...

Borrow before supply payment and its borrow millions. Last year the products were stuck in warehouses with no one to buy them and manufactures unable to pay the banks.

[sb9]

Trading update should be out anytime this week...be interesting to see commentary in light of latest Akl lockdown.

[Beagle]

Usually those trading updates are not known for an abundance of commentary, e.g. last year's one on 17 February 2020 http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/348525/316864.pdf

I think it would be nicer if they held off until later this week or even early next week when hopefully the Auckland lockdown is over and we can focus on the good news.

[winner69]

Usually those trading updates are not known for an abundance of commentary, e.g. last year's one on 17 February 2020 http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/348525/316864.pdf

I think it would be nicer if they held off until later this week or even early next week when hopefully the Auckland lockdown is over and we can focus on the good news.

and Victoria one

But then again from a profit point of view lockdowns haven't done HLG much harm

[Snoopy]

Trading update should be out anytime this week...be interesting to see commentary in light of latest Akl lockdown.


and Victoria one

But then again from a profit point of view lockdowns haven't done HLG much harm

They say in business that 'timing is everything'. Would this be the time for HLG to reclaim the wage subsidy that they didn't give back ;-)

SNOOPY

[Balance]

and Victoria one

But then again from a profit point of view lockdowns haven't done HLG much harm

HLG’s online strength shows through during the lockdowns - another major positive currently not fully priced by the market.

[winner69]

Not quite a disaster

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/367689/340457.pdf

But no doubt we concentrate on the extenuating circumstances and say a truly amazing result and as the ‘The balance sheet for the Group remains strong and stock levels continue to be well controlled.’ it’s all honky dory

[jimdog31]

Not quite a disaster

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HLG/367689/340457.pdf

But no doubt we concentrate on the extenuating circumstances and say a truly amazing result and as the ‘The balance sheet for the Group remains strong and stock levels continue to be well controlled.’ it’s all honky dory

Can never tell with you winner, how is that even close to a disaster?

[winner69]

Just as well for corporate welfare and screwing landlords else profits would have backwards even with a huge increase in sales

[winner69]

Can never tell with you winner, how is that even close to a disaster?

Way below my expectations ....and even beagle was forecasting around $25m ...and they come in under $20m

Just shows we both are useless at forecasting eh.

[jimdog31]

Just as well for corporate welfare and screwing landlords else profits would have backwards even with a huge increase in sales

How so? theyve passed that money onto their staff, maintained profitabilty, grown sales.

If the stores had been open, profit would have more than likely exceeded the job keeper payments etc and so would be reporting an even higher profit.

Its a great result all things considered.

[sb9]

How so? theyve passed that money onto their staff, maintained profitabilty, grown sales.

If the stores had been open, profit would have more than likely exceeded the job keeper payments etc and so would be reporting an even higher profit.

Its a great result all things considered.

Pretty solid result in light of what's been happening, look forward to another juicy divvy come April.

[jimdog31]

Way below my expectations ....and even beagle was forecasting around $25m ...and they come in under $20m

Just shows we both are useless at forecasting eh.

Its alot harder for all of us to forecast when you are dealing with lockdowns across both countries, and the effects/fallout of both.

24% of sales transitioning to online shows the resilience, and the stickyness of the customers.

[jimdog31]

Way below my expectations ....and even beagle was forecasting around $25m ...and they come in under $20m

Just shows we both are useless at forecasting eh.

The real question now is, how will mr market feel?

[invest]

$20m profit is a solid result, 28% above prior year. What’s more amazing is this:
Online sales continue to play an integral part and account for 24% of sales in the first half.

[LaserEyeKiwi]

I don't know how anyone thinks a 28% growth in net profits on the back of a 13.6% increase in revenue is anything but an an excellent result. A 13.6% revenue growth rate while sales were still impacted by lockdowns is fantastic, and the fact that net profit growth was double that growth rate shows fantastic operating leverage and superb management.

I didn't realise they had 11 stores in Melbourne already, its a shame they have been impacted by lockdowns of course, but that geographic growth across OZ has been excellent.

[jimdog31]

I don't know how anyone thinks a 28% growth in net profits on the back of a 13.6% increase in revenue is anything but an an excellent result. A 13.6% revenue growth rate while sales were still impacted by lockdowns is fantastic, and the fact that net profit growth was double that growth rate shows fantastic operating leverage and superb management.

I didn't realise they had 11 stores in Melbourne already, its a shame they have been impacted by lockdowns of course, but that geographic growth across OZ has been excellent.

completly agree. If those that feel its not an excellent result , feel free to sell your shares to me, as i will be buying.

[LaserEyeKiwi]

$20m profit is a solid result, 28% above prior year. What’s more amazing is this:
Online sales continue to play an integral part and account for 24% of sales in the first half.

Indeed. In fact I would be interested to know where they sit now in terms of the list of largest online apparel brands in New Zealand & Australia.

[bull....]

bit like the warehouse where noel leeming is the star , glassons is the star at this company.

As mentioned earlier on this thread the real reason halleinsteins is under going transformation is because they have lost some of there market. it is now known as the crinch brand in certain age segments.

anyway

net profit up nicely , making the most of increasing margins like most retailers.

[sb9]

bit like the warehouse where noel leeming is the star , glassons is the star at this company.

As mentioned earlier on this thread the real reason halleinsteins is under going transformation is because they have lost some of there market. it is now known as the crinch brand in certain age segments.

anyway

net profit up nicely , making the most of increasing margins like most retailers.

Guess you're in for a trade here, eh bull..

[jimdog31]

bit like the warehouse where noel leeming is the star , glassons is the star at this company.

As mentioned earlier on this thread the real reason halleinsteins is under going transformation is because they have lost some of there market. it is now known as the crinch brand in certain age segments.

anyway

net profit up nicely , making the most of increasing margins like most retailers.

Imagine when they turn that story around.....

[Ohdoyle]

I don't know how anyone thinks a 28% growth in net profits on the back of a 13.6% increase in revenue is anything but an an excellent result. A 13.6% revenue growth rate while sales were still impacted by lockdowns is fantastic, and the fact that net profit growth was double that growth rate shows fantastic operating leverage and superb management.

I didn't realise they had 11 stores in Melbourne already, its a shame they have been impacted by lockdowns of course, but that geographic growth across OZ has been excellent.

The part that is confusing for me is 4.5 million in wage subsidies and rent relief from the Australian Business. This in theory makes up 23 percent of the profit.

Therefore I'm looking at a 13 percent increase in revenue with no corresponding increase in profit. Suddenly doesn't look so amazing.

I bought in to HGL for the yield and good yield is very hard to find at the moment. This update reassures me divedends will continue to be paid, but doesn't inspire me there is massive earnings growth coming.

[winner69]

Sold $21.7m more than pcp - say gross margin up $13.0m

But npat up $5.6m. This implies expenses are up about $8m (+11%) in spite of $4.5m of Australian corporate welfare and an undisclosed amount of rent relief.

Something don't really stack up but we'll have to wait until the financials come out to try to work it out.

Once again I've got it all wrong


But at least the Balance Shet remains strong

[sb9]

Sold $21.7m more than pcp - say gross margin up $13.0m

But npat up $5.6m. This implies expenses are up about $8m (+11%) in spite of $4.5m of Australian corporate welfare and an undisclosed amount of rent relief.

Something don't really stack up but we'll have to wait until the financials come out to try to work it out.

Once again I've got it all wrong


But at least the Balance Shet remains strong

You should probably adhere to your sign off line...which says something like earning do not matter under current environment....

[LaserEyeKiwi]

The part that is confusing for me is 4.5 million in wage subsidies and rent relief from the Australian Business. This in theory makes up 23 percent of the profit.

Therefore I'm looking at a 13 percent increase in revenue with no corresponding increase in profit. Suddenly doesn't look so amazing.

I bought in to HGL for the yield and good yield is very hard to find at the moment. This update reassures me divedends will continue to be paid, but doesn't inspire me there is massive earnings growth coming.

The $4.5 million in wage subsidy went to cover staffing costs during lockdowns - those same staff were generating no revenue or profits during that time. One way to think about it is that Glassons could have instead not received the wage subsidy and instead laid off all their staff during lockdowns and avoided much of that expense - in that scenario profits would have been somewhat similar as the $4.5 million not received from the wage subsidy would have been offset by the reduced operational costs (in that hypothetical of course it would have been much more disruptive in terms of having to restaff again and also layoff costs).

[Balance]

Sold $21.7m more than pcp - say gross margin up $13.0m

But npat up $5.6m. This implies expenses are up about $8m (+11%) in spite of $4.5m of Australian corporate welfare and an undisclosed amount of rent relief.

Something don't really stack up but we'll have to wait until the financials come out to try to work it out.

Once again I've got it all wrong


But at least the Balance Shet remains strong

Sell sell sell

Not a stock you have been comfortable with, unlike me so time to exit, W69

[jimdog31]

Sell sell sell

Not a stock you have been comfortable with, unlike me so time to exit, W69

get in the queue Balance I was here first 😂

[winner69]

The $4.5 million in wage subsidy went to cover staffing costs during lockdowns - those same staff were generating no revenue or profits during that time. One way to think about it is that Glassons could have instead not received the wage subsidy and instead laid off all their staff during lockdowns and avoided much of that expense - in that scenario profits would have been somewhat similar as the $4.5 million not received from the wage subsidy would have been offset by the reduced operational costs (in that hypothetical of course it would have been much more disruptive in terms of having to restaff again and also layoff costs).

But most of sales not made through closed stores probably ended up as online sales .... so if you think about it the wage subsidy improves profitability.

[Beagle]

How so? theyve passed that money onto their staff, maintained profitabilty, grown sales.

If the stores had been open, profit would have more than likely exceeded the job keeper payments etc and so would be reporting an even higher profit.

Its a great result all things considered.

I think that sums it up. I was hoping for more but have probably underestimated supply chain air freight costs. The more I hear from companies the more I realise that freight costs at the moment are an issue. High exchange rate will provide excellent tailwinds for the current half. I am still confident of 50 cps in fully imputed dividends for FY21 = ~70 cps share gross and the next big dividend is due in April. 9.1% gross yield makes this a compelling hold.

[jimdog31]

But most of sales not made through closed stores probably ended up as online sales .... so if you think about it the wage subsidy improves profitability.

Margin on online isnt always as good, plus “free shipping” of those goods comes at a cost.

Its all relative , and i agree with laser had the stores been open we would be looking at a higher profit without the subsidies.

[winner69]

Sell sell sell

Not a stock you have been comfortable with, unlike me so time to exit, W69

Probably can't get any worse ...so might take chance to get some more on the cheap ..... maybe 650 if market disappointed

But then again with such big %ages it might be a star today and we be all happy

[Balance]

Probably can't get any worse ...so might take chance to get some more on the cheap ..... maybe 650 if market disappointed

But then again with such big %ages it might be a star today and we be all happy

Haha - love your sense of irony, W69.

What would we do without your thought provoking digs?

[Waltzing]

Report card, could have done better. Just joking.

Well who would have thought since every time i pass the local shop its empty and i have to report back to our private team its empty again...

:ohmy:

very very happy Mr B as once again he "BE BEST..." SNL live .

[oldtech]

Mr Market appears to be happy with the result ... up 21c already

[Balance]

Mr Market appears to be happy with the result ... up 21c already

Mr Market waking up to the true potential of this high yielding growth company, and its online strength.


HLG’s online strength shows through during the lockdowns - another major positive currently not fully priced by the market.

[Waltzing]

its been a highly profitable trade for a long time... new range 7.00 - 9.50.

[Rawz]

I am with those that see it as a positive result.
Growth is growth is growth. And during a time when your stores are closed...

Investing in a company that continues to grow, still valued attractively, pays an impressive dividend and strong balance sheet.

[Waltzing]

well done to the team at HLG

[winner69]

Mr Market appears to be happy with the result ... up 21c already


Up 22c now

[Waltzing]

could this company continue growth without some more capital? The balance sheet has plenty buy some of it will be spoken for. Thats why i suspect no special div or not much.

[nztx]

Probably can't get any worse ...so might take chance to get some more on the cheap ..... maybe 650 if market disappointed

But then again with such big %ages it might be a star today and we be all happy

still three or more of us in the queue ahead of you on that one .. ;)

650 pennies might be a bit wishful .. ;)

[Beagle]

could this company continue growth without some more capital? The balance sheet has plenty buy some of it will be spoken for. Thats why i suspect no special div or not much.

They had 83 cps in spare cash at the last balance date. They don't need any more capital as much of their growth is coming online. I think they are taking a very prudent approach towards new store openings in the current environment. Worth noting that depreciation is about $10m a year. You can do a fair bit with $10m of new capex each year such as store refurbishment and a prudent amount of new store openings.

As N.Z's oldest listed company I really like the carefully measured and conservative way they go about growing their business.

[winner69]

Deleted ....Should have looked to earlier posts

[Waltzing]

"You can do a fair bit with $10m of new capex each year such as store refurbishment and a prudent amount of new store openings."


Getting that extra dollar starts to get expensive at some stage. The bigger you get the more complex it becomes.

we also thought 10 million would be needed and thats why special div being a big one might not be a good idea...

retails needs a buffer and keeping some dry powder is a good idea.


Big world small company.

Even Team NZ has a French designer.

At some point going international requires some buy in from team members who are internationals.

[Beagle]

Huge amount of scope for growth close to home in Australia. I am very comfortable with how they're running the business. No need to fix anything that isn't broken.

[macduffy]

At some point going international requires some buy in from team members who are internationals.


HLG management is too canny to throw away money by trying to compete on the international stage! ( For current purposes, treat Australia as "local")

:cool:

[Waltzing]

" No need to fix anything that isn't broken."

:t_up:

[oldtech]

Hmm ... after a promising start, the SP is heading downwards. :confused:

Wonder if the market is getting jittery about the possibility of an extended lockdown?

[winner69]

Extraordinary performance by HLG over the pandemic period .... is there a word for better than extraordinary?

Taking the last 2 half years which cover February 20/ January 21 which covid has basically had severe impacts for the whole 12 months HLG has had sales of $310m and npat of $32.3

Compare that ti the prior 12 months (Feb19/Jan20) which was a period of great consumer demand - it that period sales were $296m and npat was $28.4m

So even during a pandemic that the world hasn't seen for over a century HLG sold heaps more and made 14% more profit than they did in good prior year

Almost like a pandemic hasn't happened

Is stupendous better than extraordinary?

[winner69]

Hmm ... after a promising start, the SP is heading downwards. :confused:

Wonder if the market is getting jittery about the possibility of an extended lockdown?

Victoria lockdown over

[Tripp]

Hmm ... after a promising start, the SP is heading downwards. :confused:

Wonder if the market is getting jittery about the possibility of an extended lockdown?
People might also be taking some profits to cover their initial investment.

[nztx]

Victoria lockdown over


Meanwhile the Contacts List here grows to 120 - any advances ?

An extra 2 + the 3 = 7 days ? surely not ? ;)

everyone remains mystified at how it happened..

and a hoarde of Health Dept bods are furiously swarming around exploring why Auckland temporary
visitors to the Naki didn't partake in the local Kai while out west, resulting in more casing things out .. ;)

[nztx]

Extraordinary performance by HLG over the pandemic period .... is there a word for better than extraordinary?

Taking the last 2 half years which cover February 20/ January 21 which covid has basically had severe impacts for the whole 12 months HLG has had sales of $310m and npat of $32.3

Compare that ti the prior 12 months (Feb19/Jan20) which was a period of great consumer demand - it that period sales were $296m and npat was $28.4m

So even during a pandemic that the world hasn't seen for over a century HLG sold heaps more and made 14% more profit than they did in good prior year

Almost like a pandemic hasn't happened

Is stupendous better than extraordinary?


think you nailed it well there Winner

the only thing still left hanging in the wings is what will be trotted out after the fat lady finishes singing .. ;)

Just organising an empty truck .. just in case ;)