MHJ - Michael Hill International.

[Silverlight]

Two trades, fior 6.1m & 5.6m, seems like there was a middle man on the deal and only 6m shares have changed hands.

The 5% SSH threshold is 20m for disclosure, unless it was Hill selling some, or ACC buying (which could push them over the 5% margin from their current 13.9m shares), we won't be able to see who it was for another two weeks, when registry details update.

[K1W1G0LD]

It looks like things are at last improving for MHI. Trading definitely improving .



MONTHLY: MHI: 6 months trading update to 31 December 2009 08:32a.m.
MHI
08/01/2010
MONTHLY

REL: 0833 HRS Michael Hill International Limited

MONTHLY: MHI: 6 months trading update to 31 December 2009

Michael Hill International Limited
6 months sales to 31 December 2009

Note that these figures represent 5 months accounting adjusted sales results
plus December preliminary sales figures prior to final accounting adjustments
and are unaudited.

The following figures are in NZ Dollars Last Year
This Year % Var

Australia same stores 144,276,823
153,294,030 6.2%
NZ same stores 49,048,168
51,685,207 5.4 %
Canada same stores 18,544,168
16,212,847 -12.6%
Total same stores $211,869,159
$221,192,084 4.4%

Australia all stores
150,199,307 163,402,243 8.8%
NZ all stores 49,584,508
52,322,875 5.5%
Canada all stores 19,666,677
21,051,118 7.0%
USA all stores
6,999,318 7,487,850 7.0%
Total all stores $226,449,809
$244,264,086 7.9%

Exchange rates used for the 6 months:
Australia 0.83
0.81
Canada 0.71
0.77
USA 0.58
0.72

The following figures are in local currency Last Year
This Year % Var

Australia same stores AUD 120,100,614
124,423,041 3.6%
NZ same stores NZD 49,048,168
51,685,207 5.4%
Canada same stores CAD 13,175,001
12,528,868 -4.9%

Australia all stores AUD
125,067,591 132,620,181 6.0%
NZ all stores NZD 49,584,508
52,322,875 5.5%
Canada all stores CAD
13,965,554 16,280,176 16.6%
USA all stores USD 4,091,302
5,357,415 30.9%

Comments
Improved trading conditions during the key Christmas trading period helped
the group lift "same store" sales from being flat by the end of the first
quarter to 4.4% up by the end of the second quarter. All countries performed
well and improved their "same store" trading performance from the first
quarter. Retail conditions are still difficult in North America although we
have seen some encouraging trends emerging in the second quarter.

The full half year operating results are due to be released to NZX on the
18th February, 2010.

R.M. Hill 7/01/10
Chairman

All inquiries should be made to Mike Parsell CEO phone +61 403 246655
End CA:00190006 For:MHI Type:MONTHLY Time:2010-01-08:08:32:59

[bull....]

Positive announcement today.

Chart technicals going forward trend up after higher low confirmed at 60c , minor resistance at 70c heavier resistance at pivot high of last move 76c which was also fib 38% retracement resistance , a break of 76c would lead to a move to 90c.

[K1W1G0LD]

73 cents at the close .A rise of 10% in a day. Thats a bit special :):):)

[blackcap]

I am still curious as to the identity of the buyer/seller of those lots at 63.5 cents. Someone had a good deal :)

[winner69]

Amazing how long that 70 cents mark seems a hurdle for MHI .... goes over it for a short while and then falls back into the 60's again ... amazing

[cheksta]

What am I missing here?

MHI just released a half year profit $22.3m. Its highest ever FULL year profit excluding one-off items was $25.2m for the year to June 2008.

Its half year EPS were around 5.8 cents. If it can perform reasonably well in the 2nd half it should have a full year EPS of at least 10 cents, right?

At a PE ratio of 10 the share price should be at least $1.

Is MHI 50% undervalued? Or have I missed something blatantly obvious?

[macduffy]

I don't follow MHI but is it something to do with them earning the bulk of their profits in the first half ie before Christmas?

;)

[forest]

I think you are on to it Macduffy. By my calculation its typical for MHI to have 75% of its profit in the 1H.

[cheksta]

Ok that makes some sense.

If 2nd half earnings are only 1/3 that of the first half then full year EPS should be around 7.5 cents per share.

Still seems undervalued but not extremely so.

Although MHI's average annual PE ratio hasn't been below 12 in the last 10 years.

If it can produce an annual result with EPS in the 7-8 region I see MHI priced in the 85 -95 region before year end.

[kiwi_on_OE]

I thought the same cheksta, profit up 43% from memory, div up 50%, could be expected that it may continue into the future. No movement in the market, so I'm assuming the knowledgeable people are discounting these numbers.

But I've seen the same thing before, sometimes price stays still and I scratch my head wondering why, sometimes it jumps up after a few weeks and I curse myself for not buying.

[K1W1G0LD]

I have a theory about why MHI shareprice is stuck where it is and it may or may not be "tosh" who knows . Because the fundamentals are reasonably sound. I would suggest you can blame MHI themselves here for making their shares essentially "penny dreadfuls" and opening up their register to all and sundry fools and horses who can at last afford them but are'nt long term holders . Any thoughts here?

[macduffy]

I have a theory about why MHI shareprice is stuck where it is and it may or may not be "tosh" who knows . Because the fundamentals are reasonably sound. I would suggest you can blame MHI themselves here for making their shares essentially "penny dreadfuls" and opening up their register to all and sundry fools and horses who can at last afford them but are'nt long term holders . Any thoughts here?

I would doubt that's the case.

NZ's market, particularly in the leaders, is dominated by institutions who would be quick to pick up any indiscriminate selling at bargain prices. I suspect it's more a case of market expectations of a sluggish retail sector, especially in the consumer discretionary category, for a while yet.

[peat]

I mentioned about a year ago that I thought MHI had possibly hit bottom at 50c with a diagonal triangle ending.... would have been good if I've put my money where my mouth was - up 50% since then. The uptrend since then makes the current TA generally speaking look good , much better for instance than TEL or STU (which looks positively dreadful imo - descending triangle already broken on the downside) But even though I say MHI looks ok , it also looks a bit bear flagish and if that flag is to break.... say at 64c I'd be out in a diamond flash.

[winner69]

Continue to be amazed how 70 cents seems to be the rightful place for MHI ... goes up and down a bit but always seems to come back to 70 cents

Even the 5 year chart suggests 70-80 cents as its natural position ... except for a bit of irrational exhuberence around 2007 that'a where its been

[winner69]

Just won't stay above 70 cents will it ..... about 2 years ago it fell below 70 and there it still is

[blackcap]

Just won't stay above 70 cents will it ..... about 2 years ago it fell below 70 and there it still is

But gee its holding up well in a falling market isnt it.....

The question is will it go up when the market recovers.

[winner69]

Another 2 months passes and MHI shareprice still about 70 cents ... 69 on Friday

Amazing eh .... but even more amazing according to the charts MHI hasn't done much worse than than NZX over the last 12 or 6 months but has better over the last 3 months

Cant stay at 70 cents forever can it

[scamper]

EBIT of $36.240m up 38.4% on same period last year. - EBIT of $38.579m (excluding US lease surrender costs of $2.339m expensed
during period)
- Net profit before tax of $30.914m up 53.4% on last year. - Net profit after tax of $26.509m.
Last year's net profit of $66.788m included a deferred tax credit of $50.197m.
This is a great result -- last year's profit included a deferred tax credit, so it is really up `53%, not down.
And the divi has been increased.
Some poor people may not have read the announcement down far enough.

[Lizard]

I thought it looked pretty good - worth 90cps - $1.00 in my view. Though pity liquidity is so tight these days.

[scamper]

Yep, I reckoned close on a dollar as well.
Having said that, the chart is pretty horrible.
Could this be a case of TA not giving a good picture?
Belgarion's post #309 above suggests that a good result should see it "go".

[Hoop]

Yep, I reckoned close on a dollar as well.
Having said that, the chart is pretty horrible.
Could this be a case of TA not giving a good picture?
Belgarion's post #309 above suggests that a good result should see it "go".

Hmm...Scamper...Hard to pinpoint the reason why MHI hasn't fired....maybe it's off most of the peoples radar. Must admit until I read these posts I thought MHI had a bad result thanks to that investment into the US marketplace. I completely forgot about last year's one off tax credit of $50M and I read the headlines Michael Hill profits plunge 60% (http://www.nzherald.co.nz/markets/news/article.cfm?c_id=62&objectid=10667503) in the NZ Herald skim read the first bit..then thought that's enough and moved on. No mention in the first bit I read about the last years one off tax credits so no reason to pursue it any further by going to look at it in the shareholder announcements for more detail....so for me... maybe bad media press headlines is partially to blame.

TA wise.... some indicators started firing on "Black Friday" so the TA picture up until yesterdays FY result although not fanastic it wasn't that bad either.. so it was possible one or two speculative techies would've be "in" before the FY result....

The MHI chart is a strange one.. as it is hard to draw many valid trendline(3 points) on a meandering price line which also has no obvious formations. ..So have to rely more on other more complex TA indicators such as OBV Williams% RSI etc..so... maybe ...to the "quick eye over of the MHI chart" people, they see a meandering downward action of shareprice and decide to move on as well.

The fall of 3 cents (-4.3%) after the FY result seems harsh..

FA wise.....Back of the envelope calculations from Net profit after tax of $26.5M ( operational profit up 60%) Earnings/share 6.9c PE 9.6 Dividend 4.0c/s Yield 6%.... seems good to me.

TA is only a barometer of investment behaviour... So the question really is.. where were the FA and the dividend hunters yesterday?...Obviously, the small number who sold expected a lot more to be delivered from MHI.

[percy]

Hmm...Scamper...Hard to pinpoint the reason why MHI hasn't fired....maybe it's off most of the peoples radar. Must admit until I read these posts I thought MHI had a bad result thanks to that investment into the US marketplace. I completely forgot about last year's one off tax credit of $50M and I read the headlines Michael Hill profits plunge 60% (http://www.nzherald.co.nz/markets/news/article.cfm?c_id=62&objectid=10667503) in the NZ Herald skim read the first bit..then thought that's enough and moved on. No mention in the first bit I read about the last years one off tax credits so no reason to pursue it any further by going to look at it in the shareholder announcements for more detail....so for me... maybe bad media press headlines is partially to blame.

TA wise.... some indicators started firing on "Black Friday" so the TA picture up until yesterdays FY result although not fanastic it wasn't that bad either.. so it was possible one or two speculative techies would've be "in" before the FY result....

The MHI chart is a strange one.. as it is hard to draw many valid trendline(3 points) on a meandering price line which also has no obvious formations. ..So have to rely more on other more complex TA indicators such as OBV Williams% RSI etc..so... maybe ...to the "quick eye over of the MHI chart" people, they see a meandering downward action of shareprice and decide to move on as well.

The fall of 3 cents (-4.3%) after the FY result seems harsh..

FA wise.....Back of the envelope calculations from Net profit after tax of $26.5M ( operational profit up 60%) Earnings/share 6.9c PE 9.6 Dividend 4.0c/s Yield 6%.... seems good to me.

TA is only a barometer of investment behaviour... So the question really is.. where were the FA and the dividend hunters yesterday?...Obviously, the small number who sold expected a lot more to be delivered from MHI.

Loss of imputated divie may not be helping.

[scamper]

Hoop: "..Obviously, the small number who sold expected a lot more to be delivered from MHI."

Or else they only read the Herald's headline too.

Thanks for the comments, Hoop. I think the PR mob for mhi stuffed up there -- the good news should have been at the top.

Percy -- but the divi's up significantly ...

[percy]

Hoop: "..Obviously, the small number who sold expected a lot more to be delivered from MHI."

Or else they only read the Herald's headline too.

Thanks for the comments, Hoop. I think the PR mob for mhi stuffed up there -- the good news should have been at the top.

Percy -- but the divi's up significantly ...
Yes .I thought it was an excellent result.Like other posters I find the SP weakness surprising.I have posted on other threads that I think retail is not the place to be.That may be the reason,I do not know.However MHI is a class act.

[CJ]

All good. :)Giving a shareholder more than 50% without making them spend a cent. Not sure it is 'all good'.

At least they are being upfront about it. I am sure they could have done the buyback and then consolidated their shareholding.

[Silverlight]

Well I just learnt something! I thought they would have fallen under the Takeover's code creep provision, but for whatever its worth:


Exceptions to the Fundamental Rule

Limited 5% creep:

A person holding or controlling more than 50% but less than 90% of the voting rights can increase their holding or control by up to 5% of the total voting rights in the company in any 12 month period.

Unlike some other countries’ codes, the “creep” provision does not apply to holders with less than 50% - there is a “no fly zone” between 20% and 50%..

[ratkin]

Packer has been doing a similar "creep" wth consolidated media holdings.

This MHI buyback seems very small though , they already have 49% so its not going to take much to push them over the 50%.
It removes the possibility of any takeovers although the chances of that were minicule anyway

[winner69]

MHI jsut can't stay above 70 cents can it

Except for when the markets were stupid and overvalued everything (during 2007 and 2008) MHI has essentially been between 60 and 80 ..... the 90 side pre 2007 and the lower side post 2008

maybe based on this observation MHI is about fairly (or rationally) valued at the moment anyway and the market has got it right

[blackcap]

MHI jsut can't stay above 70 cents can it

Except for when the markets were stupid and overvalued everything (during 2007 and 2008) MHI has essentially been between 60 and 80 ..... the 90 side pre 2007 and the lower side post 2008

maybe based on this observation MHI is about fairly (or rationally) valued at the moment anyway and the market has got it right

To be fair winner... it was trading about 70 and at 72 even but has just gone ex div....

The question is, will it climb back over now?

[ratkin]

Its annoying, i had a buy order in overnight and the sales announcement means i missed out on being filled. Am already a holder so i suppose its good really

[blackcap]

lol @ Belgs comment. Im hoping this sales announcement will tip it over that 70 cent mark from some time to come. This is very strong considering it is ex div time. Not that the div is large but 2.5 is not to be sneezed at. Great to see US and Can contributing. Maybe turned the corner there....

[blackcap]

Still a big IF there Belg, but if they can get the formula right in US and Canada like they have in NZ and IF they can get their brand established there well then anything is possible with this share. IF these IFs come in I can see MHI at $10 in 3-5 years time but that is still the question for now.

[gregrday]

Hi guys,

following up on the XRO valuation I did a month or so ago, I've done a new summary and valuation of Michael Hill.

I've changed the format, added in the summary section, and performed a simple growth discounted cash flow to produce a per-share value. I'm really interested in getting feedback about this doc, ie, is this useful? Any thoughts for improvements appreciated too.

check it out at http://gregnz.wordpress.com, and I'll see you at the AGM!

cheers
Greg

[forest]

Hi gregrday, I am just wondering what growth rate for cash flow, what cash flow (FCF, Op CF ?), and what discount you have assumed and why?
Cheers, Forest.

[gregrday]

Hi Forest,
its all in the pdf on the blog, but basically I'm trying to work out whether shares are under or over valued. So growth rate was assumed to be a stable growth rate, cash flow was free cash flow to the firm, and discounted at 10% (WACC from PWC). The growth rate wasn't really that important, in almost any scenario, the shares appear to be trading at a significant discount.

check out the pdf, let me know if more questions, or any thoughts on improving the doc...

cheers
Greg

[blackcap]

Hi Winner,

Now that it seems to have "held" about 70 cents, are you revising your predictions with regards to MHI?

Cheers

[ratkin]

Kim Kardashian seems to have ended up with most of the shareholders money. Has M Hill reached that stage in life where he starts giving away all the money to young women?

[Stranger_Danger]

I don't get who Michael Hill is trying to appeal to - surely trailer park residents can't afford rings?

[scamper]

the chart is the best it's been for a year -- 75 c and holding.
is mhi in for a run?
global economics rather argue against it.

poor ol' scamper has never heard of kim k-whatever. what have i missed?

[peat]

I don't get who Michael Hill is trying to appeal to - surely trailer park residents can't afford rings?

TBH I always thought that was exactly who he was appealing to - he's a mass market jeweller.

[winner69]

Hit 80 ... finally

Will buy some now as it heads to 100 ... then 125 .... then ????

[gregrday]

I have a pretty conservative valuation on MHI at 90c-$1 (check out previous post, and gregnz.wordpress.com). Thats essentially saying they will only grow at about 2% forever. Am looking forward to AGM, although have some ... questions about the 'incentive scheme' for Mike Parsell. Not very keen on that scheme, anyone else got any thoughts?

[blackcap]

Hit 80 ... finally

Will buy some now as it heads to 100 ... then 125 .... then ????

Winner, was that 70 cent buffer really bothering you that much? Coz now you have missed out on 10 cents... just dont understand your rationale here.

[ratkin]

I agree , was available around 67c for ages , why not just buy then if you liked the stock.

[blackcap]

W69 always checks with the tea ladies and if they don't have good stuff to say he backs off.

Winner, Im not baiting, im genuinly interested. Is it a TA thing you have or do you feel more comfortable buying on the up out of the range as it were? I think MHI has a way to go but that is just my humble opinion. And a EMH fan would say I know as much as my neighbour :)

[gregrday]

MHI jumped up from around 71c on 7th october to 82c today, a climb of about 17% in 3 weeks. I'd love to blame my valuation affecting the markets, but the only time I affect the markets is either when I buy (and prices drop like a stone) or when I sell (and prices climb like the space shuttle). Anybody got any thoughts as to the timing of the climb?

cheers
Greg

[winner69]

76 was the magical number .... MHI had never closed above that for the last 2 years .... every time it went over 70 it met resitance at 74/75/76 and then feel back .... 2 years plus is a long time to essentially go nowhere ... opportunities elsewhere during that time I say

Now that Kim has caused the shackles to be broken MHI might go uo to where most think it should .... buy when the behaviour past trends have been broken I say .... but with tight stops

Kim might know more than the tea lady ..... maybe pillow talk better than tea leaves ... wishful thinking eh

Bit difficult getting a fair chunk ... hope don't need to sell in a hurry if this just a burst of irrationality

[ratkin]

Hey winner , Michael hill has been slagging you off behind your back.

Jewellery magnate Michael Hill challenged "wimp shareholders" yesterday to sell their stock if they were only in the company for short-term gain...

[blackcap]

I like the bit about Michael and Kim going on tour together :)

[Jay]

I thought he had shelved the idea of increasing his stake a few weeks back

[h2so4]

MHI jumped up from around 71c on 7th october to 82c today, a climb of about 17% in 3 weeks. I'd love to blame my valuation affecting the markets, but the only time I affect the markets is either when I buy (and prices drop like a stone) or when I sell (and prices climb like the space shuttle). Anybody got any thoughts as to the timing of the climb?

cheers
Greg

People getting excited about increased sales figures as announced.

SP seems to have settled back down again.

[Hoop]

Jewellery magnate Michael Hill challenged "wimp shareholders" yesterday to sell their stock if they were only in the company for short-term gain...

"Hoop the Wimp"

MH should be proud I took his advice and sold out.. :) ........................ for a nice profit

but

If it breaks up over 84c..... "I'll be back" quote The Terminator (1984):eek2:

[CJ]

Nope. It went to the AGM .... http://www.directbroking.co.nz/directtrade/dynamic/announcement.aspx?id=2647212 ... relevant bit:

5. " That shareholders approve for the purposes of the Takeovers Code,
the consolidation of the Hill Family shareholdings in the Company into a
single entity through the transfer of the holdings of the Quinten Trust,
Michael Hill International Share Trust and the Boxer Hill Trust to Durante
Holdings Pty Limited ('Durante') being an entity wholly owned by the Boxer
Hill Trust, in the manner set out in the Explanatory Notes" That is just consolidating their holdings, not increasing the %.

With the company tax rate being lower than the trust tax rate, this could be as simple as a tax efficient holding structure. I am sure the Hill family dont need the dividend income stream for day to day living so retaining in a company makes sense.

[Hoop]

You'll be back. Only the broker (and maybe a long term holder that bought) made any money out of your trade ... ;)

I wonder what the NZX regulatory committee made of MH's comments ... Are AGM comments considered to be NZX approved "market announcements"?

Must admit Belg...MHI wasn't not one of my better portfolio holdings and it wasn't that big a portfolio holding about 4% which really is an useless holding if you are after cap gain. ..tentatively bought in during a mental implosion just after New Year 2010 thinking the good news at 68c + a possible dividend increase + the thought that the overall NZX market was going to keep rising up (a rising tide raises all boats)...however the plan went awry the NZX fell..nearly pushed the bail out button on many occassions but the tight trading pattern kept me in...not much else around + I had cash at hand then...

Didn't buy anymore on the recent 72c symmetrical triangle breakout because I'm so over MHI shares... it briefly paused at 80c giving me an "out"...reason:.. I'm now 99.5% in the market and I really need cash in a hurry to buy another share I'm interested in.....yeah made 12c/share + a couple of Dividends 1.5 + 2.5 = 4c/share and my brokerage didn't eat much cap gain ..so no disaster Belg made 16c/s (maybe 15c/s) on an outlay of 68c/s
But if MHI goes over 84c may be tempted to cull something else in my portfolio and re-enter if there is not much else around at that time..who knows

[ratkin]

Partial takeover at 90c.

How much of the recent price rises can be attributed to people in the know?

90 cents not enough to have me running for the exits , but a vote of confidence for the stock that
Mr Hill wants more shares in his own comaany

[Silverlight]

How much of the recent price rises can be attributed to people in the know?

Not really in the know, the market has been expectating something since the Hill family made their intention known in August.

[blackcap]

But the price was 70 cents then... its moved a lot lately on little or no news while the markets in general have been moving sideways. I bought some more at 70 a while back and am now wondering if I should ditch some of them....

[CJ]

Why give him 50% control for only 90c.

[moimoi]

Exactly CJ...and even more so when in august the CEO was quoted in the NZHerald that their movement then had nothing at all to do with wanting majority control.(or words to that effect).

[CJ]

Also makes you wonder why they want it. They have effective control now anyway with 45% so the only think they couldn't push through is something that requires 75% or something that only requires 50% but everyone else would vote against (which almost never happens)

[blackcap]

Belg, with you on this one... but why are the ACC and the other fund selling some of their shares? I wouldnt mind knowing the rationale behind this. Also if they creep provisions are in place and they can purchase up to 5% of shares in any one year... that will seriously underpin the shareprice one would think. Interesting... the free float on shares will be even less once Durante have their 50.1%... Happy holder at this stage

[winner69]

Things going so well for MHI (todays announcement) nobody should sell into his offer eh

[K1W1G0LD]

Yes, Winner, I would'nt be selling these shares anytime soon. This guy is a smart cookie and MHI is bucking the current gloomy retail forecasts. If they keep posting positive profit announcements and the US market picks up this share could easily hit a $1 plus , regardless of the buyback . I'm a happy holder.

[blackcap]

a cynic would say he should have waited with the announcement.... :P

[blackcap]

looks like they are having trouble getting enough acceptances at 90 cents. Can and will they raise their bid?

[blackcap]

Agree Belg, got a letter in the mail today from Durante, signed by Sir M himself. Smacks of desperation...

[Phaedrus]

Durante have received acceptances for 78% of the 9 million shares required to declare the Offer unconditional.

They claim to be "encouraged by the response and confident that the Offer will succeed".

We'll see.

[K1W1G0LD]

Totally underwhelming response to this result and the ordinary dividend ........................I think everybody wants to know whether or not MHI reach their target and whats going to happen if they don't. Until then the shareprice is going nowhere.

[_Michael]

Totally underwhelming response to this result and the ordinary dividend ........................I think everybody wants to know whether or not MHI reach their target and whats going to happen if they don't. Until then the shareprice is going nowhere.

Am I the only one that thinks having one family own a controlling stake is a huge negative?

I like this business and Michael Hill but it really does mean there can never be a truly independent board and any large decisions will be at the whims of the Hill family if they have 50.1%

Or am I missing something and they do not have voting rights on all of their shares?

[_Michael]

I would impressed if anyone actually knows what this release means precisely. Good old NZX wondering why the retail investors stay away from the market yet they insist on allowing messages to the market to be in cryptic mumbo jumbo language. I cannot think why other than nobody can be bothered in redesigning the forms to make them useful!



MHI
21/02/2011 08:30
RELINT

REL: 0830 HRS Michael Hill International Limited

RELINT: MHI: Ongoing Disclosure Notice (Leslie Wayne Peters)

DISCLOSURE NOTICE

Disclosure of Directors and Officers Relevant Interests
(Section 19T, Securities Markets Act 1988)

A. Disclosure obligation (tick box to note which disclosure
obligation applies)
Initial disclosure (complete Parts A, B, C, D, F, and G of this notice)
Ongoing disclosure (complete Parts A, B, C, E, F and G of this notice) X

B. Preliminary
1. Name Leslie Wayne Peters
2. NZX company code of issuer MHI
Name of issuer Michael Hill International
3. Name of related body corporate (if applicable) N/A
4. Position you hold in the issuer Director
5. Date of this disclosure notice 18/02/2011

C. Nature of relevant interest
6. Name of registered holder(s) of security (as required by regulation
6A(b) or regulation 7(b)) Funds under management
7. Class and type of security (as required by regulation 6B or regulation 8)

Ordinary Shares
8. Nature of relevant interest in security (as required by regulation 6A (a)

or regulation 7(a)) Non-Beneficial

D. Date (for initial disclosure)
9. Date of disclosure obligation (as required by regulation 6C) N/A

E. Transaction (for ongoing disclosure)
10. Date of last disclosure (as required by regulation 13) 24/02/2010
11. Date(s) of acquisition(s) or disposal(s) (as required by regulation 9)
18/02/2011
12. Number of transactions (as required by regulation 12(2), if applicable)
1
13. Nature or type of transaction (as required by regulation 11(1)(a))
Termination of management
of client account.
Control and voting rights over
shares relinquished.
14. Consideration (as required by regulation 10) N/A
15. Number of securities held prior, set out by class and type (as required
by regulation 8) 46,618,500
16. Number of securities subject to acquisition or disposal (as required by
regulation 11(1)(b)) 644,000

F. Extent of relevant interest
17. Number of securities held now, set out by class and type (as required
by regulation 6B or regulation 8) 45,974,500
End CA:00205814 For:MHI Type:RELINT Time:2011-02-21 08:30:13

[kizame]

Agreed! they are absolute crap,why can't they just simply state someone bought or sold such and such amount of shares and be done with it,simple small memo would do.
Not a fan of Mark Weldon at all,he's a puppy,licking heals.

[Silverlight]

Good old NZX wondering why the retail investors stay away from the market yet they insist on allowing messages to the market to be in cryptic mumbo jumbo language.

To be fair on NZX, the MED are the ones who design the forms, NZX is just the medium for them to be released.

Agreed they are not as clear as they could be.

[Jay]

From Sharechat news:

Partial takeover of Michael Hill unconditional


Monday 28th February 2011
Text too small? (http://www.sharechat.co.nz/text-too-small.html)
The Hill family's partial takeover offer for jeweller Michael Hill International (MHI) has become unconditional, with acceptances exceeding the number of shares sought.
Late last year it was announced that Durante Holdings, an Australian company set up to consolidate the holdings of shares in MHI held by the Hill family through family trusts, wanted a controlling stake in the company.
Durante, a wholly-owned subsidiary of one of the Hill family trusts, owned 47.6% of shares in MHI when the offer was made. It sought to buy 5% of the shares it did not already own to take its holding to 50.2%.
Today, Durante said that as at 10.30am it had received acceptances for 12.14 million shares, more than the 10.03 million it wanted.
All the requirements of the offer, which closes today, had been met and was now unconditional, Durante said.
As a result of acceptances exceeding the number of shares sought, scaling would be undertaken.
------------------------------------------------------------------------
Maybe the shareprice may recover a bit now or maybe not!

Disc: Did not sell any of mine - Long term Portfolio

[scamper]

I reckon 92 was the breakthrough. Loving 93.
Can it be sustained or, more to the point, be built upon?
The RSI aint much, but macd all positive. Can anyone find an OBV please?
Fingers crossed. Cheers

[evander]

OBV looks good. This indicator is available free on FinData.co.nz website, select products then charting, it is not the easiest to read but its free!

[Phaedrus]

I reckon 92 was the breakthrough.Sure was. Seven times MHI tried and failed to break the resistance at 91 cents, with the breakout finally coming over a week ago. Since then, this broken resistance has now become support (light green arrow) just as the book says it should.


The RSI aint much...It looks pretty good to me - had you noticed the recent Bullish Divergence?


... but macd all positive. I wouldn't place too much reliance on that, Scamper. As a longterm "Buy and Hold" MHI has appreciated at an average of 33% pa. Trading it using MACD signals would have returned just 5.8% pa. Only 1 in 3 MACD signals lead to profitable trades - now that ain't much!

MHI has been in a narrow 86 - 91 cent trading range for months. We should not be too surprised that this eventually broke to the Upside for the following reasons :-
(1) Trading ranges formed after an uptrend are usually a consolidation pattern in that 70% of them break to the upside.
(2) The OBV continued to rise even though the price did not. MHI was being accumulated.
(3) The RSI(14) (default value) had triggered a Buy signal and had made a Bullish Divergence.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/MHI511.gif

[scamper]

As usual, many thanks, phaedrus.
I not at all sure of the parameters and significance of divergences in the rsi. would love an explanation when you've time.
The obv sure is marvellous. thank you for the web site link, evander.
cheers, scamper.

[arcticblue]

(1) Trading ranges formed after an uptrend are usually a consolidation pattern in that 70% of them break to the upside.


Where do you get your % figures from? Is it based on past testing you have done yourself or from books or elsewhere?

Thanks

[Phaedrus]

That particular one came from Bulkowski's Encyclopedia of Chart Patterns. (A really good book!)

[winner69]

That particular one came from Bulkowski's Encyclopedia of Chart Patterns. (A really good book!)

All 1,032 pages eh - truely an encyclopedia

[arcticblue]

Thanks, the book looks interesting, I've always wondered if people were just making up the numbers or had done actual testing to find the numbers. I think I'll have to get hold of a copy of it.

[Jay]

Can't remember - Is a Friday release a good sign or bad one? ;)

Depends whether it is as the market opens or about to close when they release it, if the latter not good i would think :huh:

[arcticblue]

I like the company and think it's well run but I'm not convinced it's a breakout. For the last 6 months the share price has been in a range between 86-94c, and for most of that time 87-93c. This recent rise just puts it back into the middle of the range and there doesn't appear to be any significant trades in the past few days. The report is good news and shows that the company is doing really well in Canada, almost breaking even now but the market as a whole appears to be trending down taking MHI with it. If the price breaks above 94 then it would be more interesting.

DISC sold a few days back.

[arcticblue]

It thought last year the final div was 2.5c this year 3c. I would have thought a similar 2.5c div was priced in so only the extra 0.5c was unexpected. Thus only pushing up the price by 0.5c potentially. Although the price has started to rise so maybe it will breach the 94c resistance level in the near future.

[percy]

https://www.nzx.com/companies/MHI/announcements/214920

Good results coming out of the US! ... Just need more stores there now.

Would think MHI would find landlords very keen to have an expanding business as a tenant.Good time for MHI to find some good locations at reasonable rental.

[h2so4]

Another business I wouldn't go near for the simple reason that over the last few years inventory turns have been consistently falling. Happy to wait for the next growth phase.

[h2so4]

I don't know belg old chum. You might be right. My thinking is that if you are manufacturing to retail yourself, then in todays retail and manufacturing world, you are making business that much harder for yourself. When retail spending declines where do you turn? Do you keep on opening more and more shops?

Arn't Billabong in this very position?

[upside_umop]

Have you guys looked into their Professional Care Plans (PCP) at all?

An excerpt from the 3 month update in October:



The figures stated above do not include revenue collected from the sale of Professional Care Plans (PCP), an initiative launched in October 2010. The revenue from these plans is carried on the balance sheet as deferred revenue and will be brought to income over the life of the plans (3 Year and Life Time).
The PCP programme has the potential to contribute materially to income. Initially, the rate at which this revenue is brought to income will be largely based on our research of similar programmes in North America. As we gain a better understanding of the Company’s actual experience, we will progressively refine the rate at which this income is recognised.
Because the PCP programme has been in place for less than a year the company is not in a position presently to accurately estimate the amount likely to be brought to income for the period covered by this trading update. The amount that will be brought to income at the half year and full year will be estimated at those times, and will be based on that overseas research and the data collected over the period in relation to use of the plans by our customers.

Given the revenue (not recognised in the income statement as yet...) for the September quarter was $5.4m, it looks like a significant contributor already even though it was only launched in October 2010. I'll be interested in the half year results to see the costs of sales - I imagine it will be quite good.

[upside_umop]

Quite impressive growth in the PCP front....almost $10m in the final 3 months. Still looking forward to seeing the margin they have worked out on that revenue stream through their model.

It does look like they are suffering quite a lot in other areas though...esp Aussie (relative to prior periods...still handsome profits I'm sure!). USA looks better. Market didn't like it much though...depth fallen away?

[upside_umop]

Looks pretty good to me Belg.

Operating cashflow up significantly, due to PCP.

Summary of Key Points (all values stated in NZD unless stated otherwise)
Operating revenue of $288.846m up 7.3% on same period last year
Same store sales were 1.7% up on same period last year
EBIT of $34.775m up 9.2% on same period last year
Net profit before tax of $32.337m is up 12.7% on last year
Net profit after tax of $26.297m is up 11.5% on last year
Revenue collected from Professional Care Plans of $14.411m for the period
Net debt of $10.728m at 31 December 2011 down from $49.163m last year
Operating cash inflow of $46.800m up from $21.040m last year
7 new stores opened and 1 closed during the period
Total of 245 stores open at 31 December 2011
Interim dividend of 2.0 cents per share up 33% on last year
Equity ratio of 56.2% at 31 December 2011

[Lizard]

Those professional care plans are going to be tricky to value liabilities for. Will be interesting to see how it goes. I see the liability is written down to nil over 10 years, despite being "lifetime". Which is interesting in itself. I guess there will be plenty of takers investing in the lifetime care plan for the precious engagement ring, only to have it thrown back at them... lots of people prepared to pay for extended warranties they never use.

[upside_umop]

Liz, I think they are saying that for accounting purposes, after 10 years people won't bring their jewerelly in anymore and therefore they won't have a liability. I think they will still honor the lifetime plan, but as you say, people just won't end up using them. 1 or 2% of people might bring them in after 10 years?

PCP looks like a winner. Maybe not for the people buying into the plans though.

[Halebop]

I've had an involvement with a number of warranty style schemes over quite a few years. The keys to success is typical retail stuff - price point and volume - and a good understanding of risk pricing (this isn't what retailers are good at so they usually need to involve someone else). As suggested, the claims tail on these schemes tend to die off quite suddenly at x point in time - x varying according to product and customer demographics.

The problematic aspect of these schemes is that they tend to perform worst exactly when the retailer doesn't want them to - recessions. Bad economic times encourages customers to make claims. In good times more of them opt to ignore the problem and just buy something new. But properly priced, if you are prepared to take sometimes lumpy returns (profits can disappear just because a numbers guy told you so and 1 person in 100 will fully understand the math), they can add a nice source of cashflow.

Even a mispriced scheme can still work OK because you are getting the cash years before you need to spend it. Because Michael Hill plans to be opening hundreds more stores in the future, temporarily free cash is quite useful, even if the warranty subsequently only breaks even or makes a small loss. Better yet, if the warranty makes money, they achieve a Buffett style "free float".

[scamper]

Do you realise how far-flung your influence is, Belgarion?
I make it ~ 13% increase since your post.
Is MHI still "squarely undervalued" at 100 cps? Cheers.

[upside_umop]

Great post Halebop. I think this PCP looks like a high margin operation.
Scamper - yes. Still undervalued...
MHI has a scalable business model that just got so much better with PCP really taking off.
To think these guys eventually want 1000 stores...if they perform as they always have (check out some of their presentations for 6 monthly growth stats....increased every half since ages ago) it can only mean one thing over the long term.

[upside_umop]

http://www.stocknessmonster.com/news-item?S=MHI&E=NZSE&N=220491

Are they allowed to do this? They did not disclose to the market that they were buying 5% back before they launched their conditional offer (it's not shown on ASB Sec in any case).

What of those people who sold recently before the offer? This has obviously taken the market by surprise.....

[upside_umop]

Opps, just noticed this announcement references back to 14 January 2011 (original offer for partial takeover). It's odd that it took so long for it to come through and it still looks strange!

In any case, explains the volume over the past couple of days. MHI looking good.

[Halebop]

Have been looking at MHI’s half yearly results, hoping to make sense of their “Professional Care Plan” (PCP) numbers. There isn’t much to go on;
Revenues up very strongly in the half year results $14.411m, only $1.466m of which was recognised due to a 3 to 10 year expected exposure period.
The balance sheet now shows $21m in deferred revenue – cash will have shown a similar increase although this would have already been deployed elsewhere.

The cash benefits show through on aggregate cash and borrowing balances, which have improved markedly in the last 18 months due to higher operating cash-flows and profits.

The workings of the PCP are vague. It appears commissions or sales incentives are expensed as there doesn’t appear to be any recognition of deferred acquisition cost. When you pay for commissions and other sales expenses but the benefit of that sale extends beyond the current reporting period you may opt to defer recognition of that expense until the revenue is also recognised. If this is the case current profits on PCP are understated (or ”conservative”) i.e. If you imagine there is a 10% or 20% commission but only a 10th of revenue is recognised then there is no benefit to profitability in the current period. I’d be interested to get a clearer explanation of the mechanics of this line of business.

The balance sheet is interesting. In a decade or so Deferred Revenue and proceeds from the balancing cash receipts are likely to make up 30-50% of the balance sheet. Investors might consider they then effectively own a warranty insurer with a retail arm. Assuming the PCP is priced correctly, all that free cash will have largely paid for store expansion while profitability will probably have left the company debt free to boot. I’d hope not but perhaps they might be tempted towards corporate activity? In light of the Hill family’s recent “creep” for control perhaps the corporate activity will be privatisation?

Pricing the PCP correctly is the tricky part. The lifetime PCPs are effectively a liability with a very long tail. Even 10 years might not be enough time to know if the they are making money on them. While this might make lots of money, the risk profile of this revenue stream is very different from a retailer of jewellery.

Overall I view current performance and recent historical trends favourably. Would like to see a few more store openings but let’s face it the retail environment has been more hostile in recent years, I can also recall a share trader debate on MHI growth rates several years ago, with more conservative pundits using rates as low as 4ish%. I questioned this at the time because the time period used to generate this average was not typical of long term performance. Looking back now simple average NPAT growth for the last 7 years has been 14.3%. “Owner Earnings” have continued to be tremendous - $144m over 7 years, paying for increased dividends, organic growth and debt reduction.

On the negative NZ domiciled investors have lost imputation credits on their dividends. For a company that has delivered benefits to shareholders for years it appears they could have tried a bit harder to look after local shareholders. The franchise sale and aggregate benefits aren’t quite being evenly shared, albeit the bottom line has improved. The Hill family hold their shares through an Australian registered company, thereby capturing the Australian franking benefits.

A few basic measure snapshots follow – some components for 2004 and 2005 should be viewed with a pinch of salt as reporting requirements changed in 2006 and so I estimated a couple of missing parts (Notably Cost of Goods Sold and Wages). Occupancy Ratio is operating leases (mostly Rent) expressed as a percentage of sales (Haven’t shopping centre owners done well?)

3897389838993900

[kizame]

Damn, one of my picks for this year,but still a whole year to go yet haha.

[winner69]

Interesting quarter by quarter sales growth by country (included the pcp stuff)

Country / sep qtr growth / dec qtr growth ......from same qtr last year

Au. +14%. +6%
Nz. +9%. +1%
Ca. +30%. +20%
Us. +11%. -5%

So growth slowed a lot in dec qtr but heck still growth

Obviously ebit margin down if ebit $s remain about the same

Have faith .....remember sir mike said if you can't stand the ups and downs don't own our shares

[arcticblue]

There seems to be growth in sales but margin must be down quite a bit. There ebit is supposed to be in line with last year but they are adding $3.6mil from the PGP revenue and I would have thought a good portion of this 3.6mil is pure profit. So stripping that out there is an increase in sales but the profit from the sales is going to be lower than last year.

I do like the company especially the PGP part of it and Michael doesn't try to spin crap but just states the facts. However I think I'm going to have to sell out for now.

[noodles]

I hope that market sentiment/perception turns against it so I can buy some more shares cheap!

Where do you see the shares as cheap? I'm thinking under a $1.

[noodles]

If you hold right now, I don't see why you should sell today.

If you brought after the last quarterly review and extrapolated sales into earnings, you would have expected a better earnings result (significantly more). Given those earnings did not eventuate, I think it is an appropriate time to sell as your purchase decision was invalidated.

DISC: Do not hold MHI.

[winner69]

Sales slump probe in store for Hill chain
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10858647

Jewellery firm will analyse unexpected drop in trading to identify any oversight.


Michael Hill Jeweller will conduct an analysis to make sure the worse-than-expected trading the firm experienced over the Christmas period was no fault of its own, says chief financial officer Phil Taylor

Must be feeling a good excuse has to be given to shareholders .... might need to revert to the old 'market conditions were tougher than we thought' ... 'but we are well positioned for when market conditions improve'

However can't hide the fact that sales growth slowed quite a lot in the December quarter .... and ebit margins shrinking is a bit a worry .... maybe Phil needs to a bit of analysis on that

[Jim]

Maybe MHI might consider set up some stores in China where the big money is

[kizame]

Retailing can be like that,it can be tracking along nicely up to xmas,then for some reason the pot just doesn't boil, so to speak.
You can do everything right,but the spending goes elsewhere.
I was a retailer for 15 years and sometimes the market just gets tired,but will revive at a later stage.
They along with Pascoes dominate their field,it would be of real interest to know how Pascoes and stewart dawson(and Farmers) traded,but alas they are private.

[Hoop]

Jewellery firm will analyse unexpected drop in trading to identify any oversight.

The Warehouse.....

[winner69]

Jewellery firm will analyse unexpected drop in trading to identify any oversight.

The Warehouse.....

oversight was an interesting word to use in this context ..... maybe they did overlook The Warehouse as a competitor .... but doesn't explain the rest of the world

[kizame]

oversight was an interesting word to use in this context ..... maybe they did overlook The Warehouse as a competitor .... but doesn't explain the rest of the world

You know the few times I went into the warehouse over xmas the jewellery store was never busy,in fact lucky if they had 1 person looking,max 2 people behind the counter,hmmmn nope don't think it's the warehouse.
I would by jewellery from michael hill but not the warehouse,my girlfriend is a fairly frequent customer of MH,she wouldn't buy jewellery at WH.

[POSSUM THE CAT]

Kizame to much house brand junk at high prices. People have finally woken up to this.

[Hoop]

You know the few times I went into the warehouse over xmas the jewellery store was never busy,in fact lucky if they had 1 person looking,max 2 people behind the counter,hmmmn nope don't think it's the warehouse.
I would by jewellery from michael hill but not the warehouse,my girlfriend is a fairly frequent customer of MH,she wouldn't buy jewellery at WH.

Mrs Hoop is a frequent customer of MHI especially when they have their promotions.
A drop in activity from MHI in November December got her and her friends talking about shopping around
Not much happening anywhere.... so lets try the Warehouse at the Base (Hamilton)...
Good range of stock ...Great deals.. ..the quality was just as good as MHI.. The staff were knowledgeable, friendly, easy to talk too....

Bottom line November/December....The Warehouse got a $$$couple of grand from Mrs Hoop..MHI got nix.

Disc: Dont have shares in either MHI or WHS
EDIT: Yes Kizame.. the Warehouse has a poor image when thinking quality...My kids laugh at me when I say I'm going out to party at the Warehouse...some wouldn't be seen dead in the place less alone shop in it

[kizame]

That's a fascinating and useful insight - thank you Hoop!

Interesting Hoop,thanks for your reply.But they got a fair bit of my girlfriends xmas spend so(MH)... Time will tell.
The specialist retailer has been in this game for a long time and are quick to spot(usually)changes in trends or buying patterns,PLUS having international stores where trends begin they should have their fingers well on the pulse,so I still think a finicky xmas trading period worldwide.(maybe; hedges bets)

[winner69]

You can't beat going to a real jeweller .....beats the mass produced stuff lie michaels stuff ....and sometimes cheaper ....even for the stuff the jeweller makes him/ herself

[Hoop]

Interesting Hoop,thanks for your reply.But they got a fair bit of my girlfriends xmas spend so(MH)... Time will tell.
The specialist retailer has been in this game for a long time and are quick to spot(usually)changes in trends or buying patterns,PLUS having international stores where trends begin they should have their fingers well on the pulse,so I still think a finicky xmas trading period worldwide.(maybe; hedges bets)

Yeah ...Overall Xmas trade didn't seem that flash in America going on media reports.... but NZ was pretty good... I Agree, MHI is a competent, large enough company to analyse their Market ... fine tune its market strategies and bounce back.....its their competitors that now should be watchful...there's nothing worse than being in the same room with a pissed off gorilla.

[percy]

Most probably losing out to on line jewellers.I note on lineAustralian retailers saw sales increase 27% while traditional retailers it was 2.6%.
Expect would be same here and Canada.
WHS would be looking at loss slimmer margins,as their rents and overheads would be a lot less per square metre than MHI.

[winner69]

Most probably losing out to on line jewellers.I note on lineAustralian retailers saw sales increase 27% while traditional retailers it was 2.6%.
Expect would be same here and Canada.
WHS would be looking at loss slimmer margins,as their rents and overheads would be a lot less per square metre than MHI.

Nothing like having a chat with the jeweller as he designs a piece just for her ... so he says. Online would never take experience away.

Should hear what the KKK ladies say about Michael's 'jewellery' over the lattes - would say he don't get much business
WHS been pushing jewellery (and most other things) on their website and daily specials and all that ... might get some traction from that seeing not many people in the actual stores.

[Lotto]

Is there a chance that MHI are factoring in a decrease in raw materials (gold and silver) which they may have on their books (thats if gold and silver prices come down this year)

[winner69]

wonder how mhi online sales are going .... prob up more than the bricks and mortar stores eh percy

[percy]

wonder how mhi online sales are going .... prob up more than the bricks and mortar stores eh percy

Would think they are up between 20% and 35%.If not they should get www.estaronline.com to do their web site.

[janner]

Think that you should has a " Disc " in there, when you mention www.estaronline.com Percy :-))

[percy]

Would think they are up between 20% and 35%.If not they should get www.estaronline.com to do their web site.

Thanks Janner.
As a matter of record/"Disc" Percy and a number of Sharetrader's more astute posters have shares in www.estaronline.com, and none as far as I can remember hold any MHI.

[janner]

Astute indeed :-))

[percy]

Astute indeed :-))
The "astute" was no problem,however was not sure how to qualify it?
Choices were; very, more, or most.!!!!
lol.

[janner]

The "astute" was no problem,however was not sure how to qualify it?
Choices were; very, more, or most.!!!!
lol.

My " astute " Percy was in regard to not holding MHI..

Another company held by family for family IMO.... al la.. RAKON..

[percy]

My " astute " Percy was in regard to not holding MHI..

Another company held by family for family IMO.... al la.. RAKON..

Can't stop laughing. lol.

[percy]

That's unfair. Sir Michael Hill genuinely does care about investors in his company. As far as I can recall, he's been an ethical and responsible leader for his company.

My issues with Michael Hill (the company) relate to the general difficulties of mall and High St retail in the age of the internet, and the overall macro-economic issues facing consumers and spending, but I'd never consider Sir MH as unethical, or that he ran the company for him and his family over that of other interests.

Sir Michael was a man who worked on his business, rather than in his business. In his heyday, he cared deeply about the image of his company, he worked on his relationship with brokers and investors, and was not a man who focused solely on the moneyed city slickers, but would regularly take the message of company progress into the regions of NZ.

Sorry if this reads like a hagiographic obit for Sir Michael, but I really think it unfair to suggest his leadership of the company could be mentioned in the same sentence as Rakon.

Agree with you.!!!
A fantastic example of what can be achieved by a great business man.
I also think the issues of mall rents and internet competition,retail spending etc are very real.
To other posters may I apologise for what I thought was fun between Janner and me.No disrespect was meant.

[janner]

That's unfair. Sir Michael Hill genuinely does care about investors in his company. As far as I can recall, he's been an ethical and responsible leader for his company.

My issues with Michael Hill (the company) relate to the general difficulties of mall and High St retail in the age of the internet, and the overall macro-economic issues facing consumers and spending, but I'd never consider Sir MH as unethical, or that he ran the company for him and his family over that of other interests.

Sir Michael was a man who worked on his business, rather than in his business. In his heyday, he cared deeply about the image of his company, he worked on his relationship with brokers and investors, and was not a man who focused solely on the moneyed city slickers, but would regularly take the message of company progress into the regions of NZ.

Sorry if this reads like a hagiographic obit for Sir Michael, but I really think it unfair to suggest his leadership of the company could be mentioned in the same sentence as Rakon.

Oh !!.. Must be careful how I word this..

Agree with you Sparky that Sir Michael Hill is an ethical man..

It is the concept of a public company owned and run by a Family that always worries me.. Yes it is ok as a new company ..
That is how most begin..

As they get larger the " Family " usually do not have the expertise to cover all ...

Rakon have not brought much if any " New Blood " into their thinking..

The same could also be said for Murdoch.. Hill.. Rhineheart..

Would I... Have I.. Invested into any of them ??.. No !!..

Sure many have made money from them.. Many more have made greater .. Investing else where..

Family controlled companies are better left to their own devices IMO..

[janner]

Agree with you.!!!
A fantastic example of what can be achieved by a great business man.
I also think the issues of mall rents and internet competition,retail spending etc are very real.
To other posters may I apologise for what I thought was fun between Janner and me.No disrespect was meant.

haha.. Agree with you also Percy..

As we all scramble to not besmirch Sir Michael Hill...

It is your " issues " that I am trying to highlight.. The world is changing so fast today that it is almost impossible for one " Family " to comprehend and give well reasoned responses to..

[janner]

I'm sure you weren't being disrespectful, I just found the mention of Sir MH in the same sentence of Rakon a bit unfair

Glad it was just in jest.

And no, I'm not a member of the Hill family, leaping to maintain the family honour :-)

I'm sure you've worked out my surname isn't Robinson either, judging by the criticisms I've made of them too....

Sparky ... To take the heat of of percy.. It was I that linked MHI and Rakon ..

With as I have already said .. No disrespect to Sir Michael..

It is just that one should be very aware of " Family " business's.. Madoff.. and the one from the South Island ( how quickly one forgets their name. Not being invested ).. Are good examples.. Ross... etc..

There has to be independant oversight.. And not with the same " Professional Independants ".. i.e. .. Muggeridge et al..

MHI... a family business.. Not with my money..

[Everwood]

It was nice to see they have increased the dividend by small amount.

[Jay]

What are peoples thoughts now on MHI

Did I read there is disappointing retail results in general in Australia
Results not out until August
Been a bit of selling off lately - as long it was not Fisher Funds, if it was, would a good time to buy more:)

[boofters]

[QUOTE=Jay;412755]What are peoples thoughts now on MHI

Im expecting a solid 5%+ sales result with slight increase in margin, they are swimming in cash due to insurance upsell so maybe even some returned to us long term holders...mind you wishful thinking as I did liquidate most of my profits in MHI and bought SNK...jenkins!

[Jay]

Most have mine have gone due to the recent decline (for a very nice profit) - and retail not looking so good again, well not in Aus and possibly here, also thought I read they were expecting flat results.
Still sitting on most of the cash from the sale, but did buy a few EBOS and considereing FRE and/or FPH - all for the long term portfolio.

[blackcap]

Close enough Boofters? Or did you mean 5%+ on same store sales? Because then it is disappointing. I am happy enough with this. Good progress being made in tough times.


MHI
09/07/2013 13:20
QUARTER

REL: 1320 HRS Michael Hill International Limited

QUARTER: MHI: 12 months trading update to 30 June 2013

Michael Hill International Limited
12 months trading update to 30 June 2013

Note that the below figures represent 11 months accounting adjusted sales
results plus Junepreliminary sales figures prior to final accounting
adjustments. The below figures are unaudited.Same stores and all stores
revenue figures stated below include the Professional Care Plan (PCP)
revenues brought to income during the period based on an estimated pattern of
recognition.

Revenue from sale of goods and services for the 12 months to 30June 2013:

The following figures are in NZ dollars Last Year This Year
% Var
Australia same stores 319,731,519 321,273,889 0.5%
New Zealand same stores 108,049,715 109,228,722 1.1%
Canada same stores 52,095,668 51,136,868 (1.8%)
United States same stores 10,826,840 11,044,664 2.0%
Total same stores $490,703,742 $492,684,143 0.4%

Australia all stores
331,018,099 355,100,461 7.3%
New Zealand all stores 109,110,440 110,501,371 1.3%
Canada all stores 55,124,222 63,600,526 15.4%
United States all stores
11,998,659 12,337,271 2.8%
Total all stores $507,251,421 $541,539,629 6.8%

Exchange rates used for the 12 months:
Australia 0.78 0.80
Canada 0.80 0.83
United States 0.80 0.82

The following figures are in local currency Last Year This Year %
Var
Australia same stores AUD 248,592,841 257,140,948 3.4%
New Zealand same stores NZD 108,049,715 109,228,722 1.1%
Canada same stores CAD 41,840,248 42,189,547 0.8%
United States same stores USD 8,638,925 9,094,341 5.3%

Australia all stores AUD 257,365,032 284,318,778
10.5%
New Zealand all stores NZD 109,110,440 110,501,371 1.3%
Canada all stores CAD 44,264,994 52,509,541 18.6%
United States all stores USD 9,576,257 10,158,838 6.1%

Revenue from sale of Professional Care Plans for the 12 months to 30June
2013:

The following figures are in NZ dollars Last Year This Year % Var
PCP revenue collected $26,955,284 $33,072,435 22.7%
PCP revenue brought to income $6,025,417 $11,965,854 98.6%

Sales in the fourth quarter were difficult for the Group with flat sales
growth in the key Australian market and negative growth in the other three
markets for the quarter.

The year finished slightly up for the Group in NZD and all markets finished
with positive sales growth in local currency on a same store basis and it was
pleasing that these sales were achieved on a higher margin. The contribution
from new stores opened during the year resulted in revenue lifting by
6.8%.The directors are satisfied with the performance over the past 12 months
especially given theongoing challenging environment.

Cash flow remains strong and our Professional Care Plan product continuesto
deliver good cash flow to the business andis now also contributing solidly
tothe Group's results. The revenue from these plans is carried on the balance
sheet as deferred revenue and is then brought to income over the life of the
plans (3 year and lifetime plans).

It should be noted that PCP revenue is brought to account to the current
period based on estimated use of plans over their lifetimes. The amount of
PCP revenue included in the above revenue numbers is based on existing
estimates and these estimates will be subject to review as part of year end
accounts preparation.
The full year results for the 12 months ending 30June 2013 are due for
release to the NZX on the 16th August, 2013.

Sir Michael Hill 9July 2013
Chairman

[blackcap]

Close enough Boofters? Or did you mean 5%+ on same store sales? Because then it is disappointing. I am happy enough with this. Good progress being made in tough times.


MHI
09/07/2013 13:20
QUARTER

REL: 1320 HRS Michael Hill International Limited

QUARTER: MHI: 12 months trading update to 30 June 2013

Michael Hill International Limited
12 months trading update to 30 June 2013

Note that the below figures represent 11 months accounting adjusted sales
results plus Junepreliminary sales figures prior to final accounting
adjustments. The below figures are unaudited.Same stores and all stores
revenue figures stated below include the Professional Care Plan (PCP)
revenues brought to income during the period based on an estimated pattern of
recognition.

Revenue from sale of goods and services for the 12 months to 30June 2013:

The following figures are in NZ dollars Last Year This Year
% Var
Australia same stores 319,731,519 321,273,889 0.5%
New Zealand same stores 108,049,715 109,228,722 1.1%
Canada same stores 52,095,668 51,136,868 (1.8%)
United States same stores 10,826,840 11,044,664 2.0%
Total same stores $490,703,742 $492,684,143 0.4%

Australia all stores
331,018,099 355,100,461 7.3%
New Zealand all stores 109,110,440 110,501,371 1.3%
Canada all stores 55,124,222 63,600,526 15.4%
United States all stores
11,998,659 12,337,271 2.8%
Total all stores $507,251,421 $541,539,629 6.8%

Exchange rates used for the 12 months:
Australia 0.78 0.80
Canada 0.80 0.83
United States 0.80 0.82

The following figures are in local currency Last Year This Year %
Var
Australia same stores AUD 248,592,841 257,140,948 3.4%
New Zealand same stores NZD 108,049,715 109,228,722 1.1%
Canada same stores CAD 41,840,248 42,189,547 0.8%
United States same stores USD 8,638,925 9,094,341 5.3%

Australia all stores AUD 257,365,032 284,318,778
10.5%
New Zealand all stores NZD 109,110,440 110,501,371 1.3%
Canada all stores CAD 44,264,994 52,509,541 18.6%
United States all stores USD 9,576,257 10,158,838 6.1%

Revenue from sale of Professional Care Plans for the 12 months to 30June
2013:

The following figures are in NZ dollars Last Year This Year % Var
PCP revenue collected $26,955,284 $33,072,435 22.7%
PCP revenue brought to income $6,025,417 $11,965,854 98.6%

Sales in the fourth quarter were difficult for the Group with flat sales
growth in the key Australian market and negative growth in the other three
markets for the quarter.

The year finished slightly up for the Group in NZD and all markets finished
with positive sales growth in local currency on a same store basis and it was
pleasing that these sales were achieved on a higher margin. The contribution
from new stores opened during the year resulted in revenue lifting by
6.8%.The directors are satisfied with the performance over the past 12 months
especially given theongoing challenging environment.

Cash flow remains strong and our Professional Care Plan product continuesto
deliver good cash flow to the business andis now also contributing solidly
tothe Group's results. The revenue from these plans is carried on the balance
sheet as deferred revenue and is then brought to income over the life of the
plans (3 year and lifetime plans).

It should be noted that PCP revenue is brought to account to the current
period based on estimated use of plans over their lifetimes. The amount of
PCP revenue included in the above revenue numbers is based on existing
estimates and these estimates will be subject to review as part of year end
accounts preparation.
The full year results for the 12 months ending 30June 2013 are due for
release to the NZX on the 16th August, 2013.

Sir Michael Hill 9July 2013
Chairman

[boofters]

[QUOTE=blackcap;415899]Close enough Boofters? Or did you mean 5%+ on same store sales? Because then it is disappointing. I am happy enough with this. Good progress being made in tough times.


Yeah I reckon this is a pretty good result. What it shows me is their new store opening process becomes qucikly cashflow positive and that free cashflows being generated are substantial.
Im happy to hold 66% of my portfolio here for another 12 months, interesting to see also MHTL is collaborating with the Japanese golf tour, will we see asian expansion of the MHI brand?

[CJ]

I'm tempted I must say. I think its a fine company, with great people. The PCP revenue is impressive. If I thought they could grow by solid double digits over the next 5 years, then an entry point around $1.20 would sorely tempt me.Why are you interested in retail stocks at the moment (i note your comment on Pumpkin patch).

Where is the growth coming from? NZ and Australia or do you think their US/Canada expansion (are they still doing this?) will work out?

[blackcap]

Why are you interested in retail stocks at the moment (i note your comment on Pumpkin patch).

Where is the growth coming from? NZ and Australia or do you think their US/Canada expansion (are they still doing this?) will work out?

Hi CJ, I think it is a bit simplistic to have a view on retail and tarnish everyone with the same brush. As in any industry there are those that perform well and those that do not. MHI have shown themselves to be proven performers and continue to grow revenues and profits in what is difficult retailing conditions. The US and Canada expansion is still ongoing and by all accounts going well. The following figures show that All stores (not same stores which was flat) revenues are growing rather well. Canada in particular grew by 15%.

Australia all stores
331,018,099 355,100,461 7.3%
New Zealand all stores 109,110,440 110,501,371 1.3%
Canada all stores 55,124,222 63,600,526 15.4%
United States all stores
11,998,659 12,337,271 2.8%
Total all stores $507,251,421 $541,539,629 6.8%


p.s data from latest MHI announcement to market

[janner]

Hi CJ,

Being contrarian.

I'm picking growth will come from cyclical gains as the economy improves in Australia,plus overall gains from the new PCP revenue streams - as high as 40% of all sales are now also gaining PCP revenue.

Nothing wrong with being contrarian Sparky.. Do you really think that the Aussie economy will improve over the next two years ??..

I do not..

[noodles]

Nothing wrong with being contrarian Sparky.. Do you really think that the Aussie economy will improve over the next two years ??..

I do not..

Aussie PMI is terrible.
http://www.businessinsider.com.au/australia-july-manufacturing-pmi-2013-7

[percy]

Well the banner on the way out of Auckland airport is a masterpiece.
The bride showing off her wedding ring and answering the question "where did you get the ring?" Michael Hill.

[CJ]

Hi CJ, I think it is a bit simplistic to have a view on retail and tarnish everyone with the same brush. Just asking as it isn't a stock I follow. They do look to be doing well given the current environment.


Being contrarian. If trans-tasman retail is being slapped around right now due to Australian softness, then obviously its cheap and if I'm holding for a year or two I'll see some sunshine.

I'm picking growth will come from cyclical gains as the economy improves in Australia,plus overall gains from the new PCP revenue streams - as high as 40% of all sales are now also gaining PCP revenue.interesting. I would have though you would be looking at sectors which are currently in a growth stage and trying and timing of the growth in the retail cycle. Hard to do I admit so was wonder if you had seen something that made you start looking at MHI and Pumpkin patch. I note WHS and Briscoes has done well over the past year so I wonder if this is a sign people are starting to spend more, even if it is at the bottom end of the market.

[CJ]

Hi CJ, I think it is a bit simplistic to have a view on retail and tarnish everyone with the same brush. Just asking as it isn't a stock I follow. They do look to be doing well given the current environment.


Being contrarian. If trans-tasman retail is being slapped around right now due to Australian softness, then obviously its cheap and if I'm holding for a year or two I'll see some sunshine.

I'm picking growth will come from cyclical gains as the economy improves in Australia,plus overall gains from the new PCP revenue streams - as high as 40% of all sales are now also gaining PCP revenue.interesting. I would have though you would be looking at sectors which are currently in a growth stage and trying and timing of the growth in the retail cycle. Hard to do I admit so was wonder if you had seen something that made you start looking at MHI and Pumpkin patch. I note WHS and Briscoes has done well over the past year so I wonder if this is a sign people are starting to spend more, even if it is at the bottom end of the market.

[winner69]

Another solid result from MHI.

Still adding stores which guarantees future growth

Can't complain about this chart in a pretty classy presentation

[blackcap]

Yeah I agree Winner. Have held onto these for a few years now and have no reason whatsoever to complain. Their revenue in Canada is increasing at a fast rate and in difficult conditions in NZ and AUS they have done exceedingly well. To increase profits by nearly 10% and seemingly no impediment to continuing to do so this one will remain firmly fixed in my portfolio.

[Everwood]

I'm very happy with another positive result.

[Lotto]

.....whats up here?

http://www.stuff.co.nz/business/9190420

[winner69]

.....whats up here?

http://www.stuff.co.nz/business/9190420

Just what it says ... possibility that MHI will have to pay a lot of tax and in future the tax bill will more than the last couple of years ... ie reduced profits after tax

[blackcap]

This is not anything new. Has been known by quite a lot of ppl for a long time now. So no immediate dent in the shareprice... Maybe holding it back until there is some certainty?

[blackcap]

Another stellar 3 month performance? Same store sales up 3.8% whilst all stores up 8.7%. Good growth in Canada and the US.

MHI
11/10/2013 12:41
QUARTER

REL: 1241 HRS Michael Hill International Limited

QUARTER: MHI: 3 months trading update to 30 September 2013

3 months trading update to 30 September 2013

The below figures represent 2 months accounting adjusted sales results plus
September preliminary sales figures prior to final accounting adjustments and
are unaudited. Same stores and all stores revenue figures stated below
include the Professional Care Plan (PCP) revenues brought to income during
the period. The PCP income recognition pattern is based on existing
estimates and subject to ongoing management reviews and accordingly may be
adjusted at half year and year end. The prior period PCP revenue stated below
is included at the estimated amounts under the income recognition pattern
used and reported on at the time.

In line with the market announcement on 3 October 2013, the Group numbers
below are reported in Australian dollars.

Revenue from the sale of goods and services for the 3 months to 30 September
2013:

The following figures are in Australian dollars Last Year
This Year % Var
Australia same stores 59,543,829 60,183,650 1.1%
New Zealand same stores 17,628,665 18,517,320 5.0%
Canada same stores 9,399,281 10,818,542 15.1%
United States same stores 1,775,706 2,155,811 21.4%
Total same stores $88,347,481 $91,675,323
3.8%

Australia all stores
61,369,042 64,718,588 5.5%
New Zealand all stores 17,661,287 18,559,669
5.1%
Canada all stores 9,580,949 13,049,267
36.2%
United States all stores
1,983,014 2,152,814 8.6%
Total all stores $90,594,292 $98,480,338 8.7%

Exchange rates used for the 3 months:
New Zealand 1.28 1.15
Canada 1.03 0.95
United States 1.04 0.92

The following figures are in local currency Last Year
This Year % Var
Australia same stores AUD 59,543,829 60,183,650 1.1%
New Zealand same stores NZD 22,623,440 21,228,962
(6.2%)
Canada same stores CAD 9,710,436 10,284,027 5.9%
United States same stores USD 1,841,461 1,973,756 7.2%

Australia all stores
AUD 61,369,042 64,718,588 5.5%
New Zealand all stores NZD 22,665,410 21,277,326 (6.1%)
Canada all stores CAD 9,895,766
12,406,901 25.4%
United States all stores USD 2,056,816 1,971,011 (4.2%)
*
* One store was closed in June 2013 hence the fall in revenue for "all
stores"

Revenue from sale of Professional Care Plans for the 3 months to 30 September
2013:

The following figures are in Australian dollars Last Year
This Year % Var
PCP revenue collected $5,069,333 $6,676,219
31.7%
PCP revenue brought to income $1,800,150 $3,929,059
118.3%

The Group achieved solid growth for the quarter finishing 3.8% up on last
year for the same stores. Australia traded slightly up on the same quarter
last year while Canada and the US continue to show good growth on a same
store basis. Our New Zealand stores were unable to maintain the momentum
shown in prior quarters and ended the period 6.2% down on the prior period.

Cash flow remains strong and our Professional Care Plan product continues to
deliver good cash flow to the business and is now also contributing solidly
to the Group's overall results. The revenue from these plans is carried on
the balance sheet as deferred revenue and is then brought to income over the
life of the plans (3 year plans, and lifetime plans which are assigned 10
year notional life for income recognition purposes).

Sir Michael Hill 11 October 2013
Chairman

All enquiries should be made to Mike Parsell CEO phone +61 403 246655
End CA:00242272 For:MHI Type:QUARTER Time:2013-10-11 12:41:28

[boofters]

can someone from the black arts of technical trading explian todays 10% drop....anyone know something I dont?

[psychic]

yeah, weird. I jumped in and took out the rest at 1.39 before the bot could finish taking them all. Fall seemed to follow Dir selling a small lot from fam trust but hardly justifable.. Will see I guess. Tax issue?

[blackcap]

can someone from the black arts of technical trading explian todays 10% drop....anyone know something I dont?

I have no idea. Nibbled at 1.39 but only for a trade. But it seems weird considering no news out. Retail in NZ may be slow but most of MHI revenues come from off shore anyway. Do not often see bot trading in MHI so this is a bit of a surprise.

[psychic]

Think of all those lovely trinklets being bought for xmas by the xero and peb investors....

[scamper]

TV advertising today has a christmas special of (I think) 20% off everything.
Maybe it comes across as a fire sale for some sellers. Cheers

[psychic]

http://www.nbr.co.nz/article/michael-hill-annual-sales-rise-fastest-pace-3-years-bd-158901Michael Hill annual

"sales rise at fastest pace in 3 years.....The stock is rated a 'buy' based on the consensus of three analysts polled by Reuters, with a target price of $1.64."

[MAC]

http://www.nbr.co.nz/article/michael-hill-annual-sales-rise-fastest-pace-3-years-bd-158901Michael Hill annual

"sales rise at fastest pace in 3 years.....The stock is rated a 'buy' based on the consensus of three analysts polled by Reuters, with a target price of $1.64."

Agree it's a good result Psychic, esp when other retailers are waning, they've done well to diversify offshore over the last couple of years and now the tax overhang is resolved perhaps we will see MHI move forward.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11230092

[percy]

Agree it's a good result Psychic, esp when other retailers are waning, they've done well to diversify offshore over the last couple of years and now the tax overhang is resolved perhaps we will see MHI move forward.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11230092

A good result.Surprised me as I thought they were struggling.Nice to be wrong!

[blackcap]

A good result.Surprised me as I thought they were struggling.Nice to be wrong!

I had thought the same thing, generally because retail is struggling and because the share price has been languishing. But I am very happy to be wrong. I wonder if they are going to raise the dividend again this FY. I really like the strong growth in Canada.

[golden city]

anyone know how mhi doing this christmas.?

[golden city]

share prices looks like bottom up

[blackcap]

anyone know how mhi doing this christmas.?

Tis a small anecdote. But I was in the local MHI store yesterday talking with a lovely staff member who said that this years Christmas was better than last years. But that was for her store. She was unsure as to how other stores had traded.

[golden city]

I was in st Luke's ...it seem shop quite busy

[gv1]

They have been doing well in canada as well, in last report.
Only one retailer I feel doing ok.

[noodles]

They have been doing well in canada as well, in last report.
Only one retailer I feel doing ok.

The BIG question is how are they doing in Australia?
AUD Currency headwinds will be hurting them as well.

[MAC]

The BIG question is how are they doing in Australia?
AUD Currency headwinds will be hurting them as well.

They’re as of this year forward reporting in AUD now, the higher NZD should offer them higher reported NZD segment profits within an AUD half year report.

It's an interesting thing Noodles don’t you think, if we go back and have a look at the revenue and earnings impacts of the 2008 and 2009 GFC recession years, they weren’t actually really that great, it's odd but MHI always seems to have been a bit resilient.

Perhaps folk whom can afford to regularly buy new jewellery just keep doing what they do, perhaps those most impacted by economic dips just aren’t the target market anyway.

I wouldn’t be surprised to see MHI do quite well this coming year actually, definitely looking oversold and beaten up at two year lows about here.

I’ve got them valued (NZX) at FY15 $1.60 (+37%), how about yourself ?

6635
Analyst consensus forecast in blue

[noodles]

They’re as of this year forward reporting in AUD now, the higher NZD should offer them higher reported NZD segment profits within an AUD half year report.

It's an interesting thing Noodles don’t you think, if we go back and have a look at the revenue and earnings impacts of the 2008 and 2009 GFC recession years, they weren’t actually really that great, it's odd but MHI always seems to have been a bit resilient.

Perhaps folk whom can afford to regularly buy new jewellery just keep doing what they do, perhaps those most impacted by economic dips just aren’t the target market anyway.

I wouldn’t be surprised to see MHI do quite well this coming year actually, definitely looking oversold and beaten up at two year lows about here.

I’ve got them valued (NZX) at FY15 $1.60 (+37%), how about yourself ?

6635
Analyst consensus forecast in blue

Interesting comment on the GFC. I will have to revisit.

As your chart highlights, the company has had consistent revenue growth (although that appears to be slowing). I will reserve judgement on valuation as I'm not that familiar with the stock. It is on my watchlist and look forward to the half year results.

Best of luck,
noodles

[winner69]

MAC, your chart

In NZD?

What are HY numbers representing? They are higher than FY anf FY looks like the actual 12 months total.

Just curious

[MAC]

I annualise half year results for graphs, just a bit easier on the eye at a comparative glance, the MHI half year ends 31 Dec and thus includes the lucrative lead up to xmas season, so HY1 is more profitable than HY2, yes NZD.

Noodles, I would agree that we should keep an eye on margins, but also on some degree of earnings sacrifice for growth in establishing new markets.

[percy]

MHI have been in a solid downtrend since early November 2013.
I do not see the trend reversing in the near future.

[Everwood]

Tis a small anecdote. But I was in the local MHI store yesterday talking with a lovely staff member who said that this years Christmas was better than last years. But that was for her store. She was unsure as to how other stores had traded.

Emma & Roe stores usually have people in them each time I walk past. The stores are a nice extension to Michael Hill brand. I would also be interested in finding out how well their online store is doing.

[Everwood]

MHI have been in a solid downtrend since early November 2013.
I do not see the trend reversing in the near future.


I disagree, I think they will settle down around this range before they start slowly climbing up over time.

[nextbigthing]

MHI have been in a solid downtrend since early November 2013.
I do not see the trend reversing in the near future.

Mid to longer term it should be self arresting given the increasing yield (which surely they can maintain).

[BFG]

Mid to longer term it should be self arresting given the increasing yield (which surely they can maintain).

I tend to concur. Follow the EPS and it can only go down so far before everyone starts bargain hunting and realising it's an undervalued asset.

Chart wise, it already looks like a near term bottom is forming. Very oversold the past few weeks with the MACD dipping to its lowest point ever. The slide down the bollinger band was pretty precipitous once it failed @ $1.40 and the MA 50 and 200 failed to cross. PSAR says it's buy for a short-term bounce as the price is now inside the bollinger bands once again. Volume has been higher than usual on the fall so this may just be a breather before the next leg down. DMI shows sellers in complete control but it looks toppy as well.

Conclusion: I'd be bullish for a very short-term play over a few days in trying to break $1.20 again, but beyond that I'd be bearish and very cautious!

[blackcap]

Seems solid enough to me: (same store sales up only down in Australia, good growth in US and Canada, NZ did well too)

09/01/2015 08:30
QUARTER
PRICE SENSITIVE
REL: 0830 HRS Michael Hill International Limited

QUARTER: MHI: 6 Months Trading update to 31 December 2014

Michael Hill International Limited
6 months trading update to 31 December 2014

The Group achieved same store sales growth of 0.8% for the 6 months in AUD.
In local currency, New Zealand stores traded 4.1% up on the same period last
year while Canada continued to experience solid growth finishing 4.4% up for
the half year. The US achieved strong growth finishing 9.1% up for the half
year, however Australia continued to be a difficult market and same store
sales were 2.1% down on the prior period. Eight new stores were opened during
the period and one closed. There were 285 Michael Hill stores trading at 31
December 2014.

As mentioned in the 2014 Annual Report, the Group is continuing to refine and
test the Emma & Roe retail model and consequently this trading update does
not include financial information for the Emma & Roe stores.

As previously announced, the preliminary half year results for the 6 months
ending 31/12/14 will be released to the NZX on Friday 13 February, 2015.

Revenue from the sale of goods and services by Michael Hill Stores for the 6
months to 31 December 2014 including PCP income:

The following figures are in Australian dollars Last Year
This Year % Var
Australia same stores 166,574,835 163,086,147 (2.1%)
New Zealand same stores 53,620,694 57,597,391 7.4%
Canada same stores 35,347,063 36,241,877 2.5%
United States same stores 4,552,888 5,196,566 14.1%
Michael Hill same stores $260,095,480 $262,121,981
0.8%

Australia all stores
169,768,935 168,637,663 (0.7%)
New Zealand all stores 54,229,441 58,045,868
7.0%
Canada all stores 39,392,160 45,857,387
16.4%
United States all stores
5,485,837 6,785,933 23.7%
Michael Hill all stores $268,876,373 $279,326,851
3.9%

Exchange rates used for the 6 months:
New Zealand 1.12 1.09
Canada 0.96 0.98
United States 0.92 0.88

The following figures are in local currency Last Year
This Year % Var
Australia same stores AUD 166,574,835 163,086,147 (2.1%)
New Zealand same stores NZD 60,257,625 62,751,477
4.1%
Canada same stores CAD 33,979,844 35,477,740 4.4%
United States same stores USD 4,175,820 4,557,542 9.1%

Australia all stores
AUD 169,768,935 168,637,663 (0.7%)
New Zealand all stores NZD 60,938,964 63,238,564 3.8%
Canada all stores CAD 37,869,346
44,873,993 18.5%
United States all stores USD 5,029,956 5,957,139 18.4%

[MAC]

Seems solid enough to me: (same store sales up only down in Australia, good growth in US and Canada, NZ did well too)

Agree Blackcap, all that looks ok in aggregate, they just need to announce some solid EBIT growth in Canada on 13th Feb and they may well become the gem of the NZX retailers at present.

[blackcap]

Agree Blackcap, all that looks ok in aggregate, they just need to announce some solid EBIT growth in Canada on 13th Feb and they may well become the gem of the NZX retailers at present.

Cheers Mac, it seems we can agree on one stock at least :). Yes you are right, the EBIT growth in Canada will be interesting to say the least. I do like how Canada is growing organically and if that can translate to bottom line then MHI could have some real upside movement. A bit concerned about their Emma and Roe model but we shall see how that pans out. Good to see a positive contribution from the States as well although very early days there.

[Everwood]

I'm disappointed they did not include any financial information for Emma & Roe stores. I visited Emma & Roe store couple of times before Christmas. The store was beautifully laid out with beautiful jewellery and people in the store each time I have walked past. In my opinion Michael Hill is the jewel of retailing on NZX.

[blackcap]

Better than I was expecting, happy holder:

PROFIT ANNOUNCEMENT
Michael Hill International Limited today announced an after tax profit of AU$23.697m for the six months
ended 31 December 2014.
Summary of Key Points (all values stated in AUD unless stated otherwise)
• Operating revenue of $283.189m up 4.6% on same period last year
• Same store sales were 0.9% up on same period last year
• Revenue collected from Professional Care Plans of $19.924m up 13.4% on same period last year
• EBIT of $34.980m up 17.6% on same period last year
• Net profit before tax of $32.444m up 13.9% on same period last year
• Interim dividend of NZ 2.5 cents per share
• Equity ratio of 50.3% at 31 December 2014
• Eight new Michael Hill stores opened and one closed during the period
• Total of 285 Michael Hill stores open at 31 December 2014
• Total of eight Emma & Roe stores open at 31 December 2014

https://www.nzx.com/files/attachments/207890.pdf

[Crisis]

Better than I was expecting, happy holder:

PROFIT ANNOUNCEMENT

https://www.nzx.com/files/attachments/207890.pdf

NZ Herald: Michael Hill posts 46pc profit hike
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11401407

[winner69]

MHI 9 months sales. Look good except Australia

Doing YTD comparisons can be a bit misleading

Like Canada same store sales in local currency are shown as +2.9% but in actual fact they were DOWN 1.1% for the 3rd quarter. US sales up 2.7% for quarter v 7.3% YTD

Never mind the big picture is still all honky dory. Once Australia comes right just watch those increasing profits.

[blackcap]

I cannot work out the fall in shareprice on this news today. Yes Australia is down, (to be expected) but overall sales revenues in local currencies are up in the other 3 jurisdictions and in total as well. Stores are increasing in number (organic growth) and for mine MHI are a steal at under $1.20. There may be a blip in FY15 but long term I think prospects look great. Especially if they can crack the US market.. Canada is already doing exceptionally well.

[James108]

I would expect Canada sales to keep falling and this is a major market now. GDP growth has fallen since oil fell and check their retail stats.. not positive. Aus + Canada are 2 big markets that may struggle for a little bit.

Having said that I agree long term I think that MHi will do well, US sales is especially encouraging.

[winner69]

Share price still languishing, MHz obviously unwanted and unloved

Caught up in the retail malaise?

Don't know but the 110/220 level seems to be its lot.

[winner69]

Suppose e could say MHI is still in an uptrend even though down heaps from a recent high

Maybe MHI is a good indicator of future market collapses .... like the fall in 2007/08 appears to have started before the late 2008 market collapse.

[Deej5]

I've never understood the lack of enthusiasm for this stock. The company just keeps growing but this is not reflected in the SP. Could be a different story if and when the Emma & Roe figures are included.

[winner69]

I've never understood the lack of enthusiasm for this stock. The company just keeps growing but this is not reflected in the SP. Could be a different story if and when the Emma & Roe figures are included.

Patience by son.

Buy and hold since 2000 (15 years) gain is just over 10% pa plus dividends ----- and that is at current price of $1.10 which is 30% down from last years high.

Pretty good eh

Maybe now is a good time to buy into the long uptrend ....decent dip to enhance returns from this point

[JayRiggs]

Uh oh, down to $1.
PE of 11.3 looking a bit cheap.

Expecting the 12 month trading update any day now. It normally comes out around the 10th day after each quarter.
Since it's a 12 month update, we'll get a good comparison of the previous full year.
Hoping to see some stabilization of all regions.

[winner69]

Uh oh, down to $1.
PE of 11.3 looking a bit cheap.

Expecting the 12 month trading update any day now. It normally comes out around the 10th day after each quarter.
Since it's a 12 month update, we'll get a good comparison of the previous full year.
Hoping to see some stabilization of all regions.

A buck is pretty low eh .......probably reflects that lack of enthusiasm for this stock

I wouldn't count on any dramatic price recovery from here.

[winner69]

A close below $1, haven't seen that for a few years

And MAC had a value of $1.60 on this a few months ago and nothing's really changes

Maybe MHI is one of those bell weather stocks that can predict impending market crashes?

[gv1]

A close below $1, haven't seen that for a few years

And MAC had a value of $1.60 on this a few months ago and nothing's really changes

Maybe MHI is one of those bell weather stocks that can predict impending market crashes?

I think they will have good results...mind u retails stock are out of flavour at the moment.

[limmy]

Weak Australian sales expected, perhaps?

[winner69]

I think they will have good results...mind u retails stock are out of flavour at the moment.

I don't think it really matters how good the result is

As jay said theres a total lack of enthusiasm for this stock

It will always appear to be cheap, even in 10 years time when it might be $1.50

[Deej5]

Any ideas when a trading update will be announced and when Emma & Roe figures might be included?

[JayRiggs]

Any ideas when a trading update will be announced and when Emma & Roe figures might be included?

They normally release quarterly trading updates around the 10th following each quarter, which would have been last week. Hmmmmm, perhaps taking a bit more time to include Emma & Roe figures or massaging the figures to make em look good?

[winner69]

They normally release quarterly trading updates around the 10th following each quarter, which would have been last week. Hmmmmm, perhaps taking a bit more time to include Emma & Roe figures or massaging the figures to make em look good?

You are right ...last 3 years at least an update early July, but nothing yet this year

One thing, it can't be really bad (or good) as they probably already worked that out and would have had to say so

[Everwood]

The quarterly results have finally been released.
https://nzx.com/companies/MHI/announcements/267094

[winner69]

The quarterly results have finally been released.
https://nzx.com/companies/MHI/announcements/267094

Good / bad / so so?

[noodles]

Good / bad / so so?
Apart from Canada, SSS went backwards over 3rd quarter. I.e. A really poor 4th quarter.

[benjitara]

Canada's becoming a good market place for them indeed. All in all a decent result although it looks like aussie is a hard sale for them at the moment. organic growth opportunities still exist in other markets.

[winner69]

Market sort of impressed - up 2% in early trading

[winner69]

Have they closed a lot of Canada's stores

Total sales in Canada far greater than same store sales

Or is it cos these pcp things aren't included in stores sales?

[blackcap]

Have they closed a lot of Canada's stores

Total sales in Canada far greater than same store sales



???? cannot figure your question out winner... Total sales would be higher... if new stores were opened surely?? Or am I missing something here?

[winner69]

???? cannot figure your question out winner... Total sales would be higher... if new stores were opened surely?? Or am I missing something here?

Yes that's it, wasnt thinking that well this morning - too much cricket, golf and Tour de France overnight

[blackcap]

Yes that's it, wasnt thinking that well this morning - too much cricket, golf and Tour de France overnight

All is forgiven... I know the feeling, have just had 2 weeks of Wimbledon and still recovering.

[winner69]

Canada - same stores 62m total sales 79m

Means new stores sales 17m

I take it that new stores are the ones opened over the last 24 months?

Wonder if MHI do the pure calculation on a yearly basis?. Some outfits make adjustments for cannibalisation and such things.

[winner69]

This opinion piece in Retail News sort of suggests the jury still out on whether Emma and Roe is going to be a success.

Michael Hill’s Emma & Roe – a charmed life?
Posted on July 17, 2015 by RetailNews in Opinion, Retail Blog – Opinion // 0 Comments

“Fail fast” is an axiom of modern business life, so what are we supposed to make of Michael Hill International’s ‘test’ of its Emma & Roe chain of quality charm stores that began mid-to-late 2012?

It appears the physical presence of the brand is not growing as fast as the jeweller had expected and the hoped for test ‘result’ has not eventuated. So the Emma & Roe test run continues.

In its trading update for the year to the end of June out today, Michael Hill reported it was “continuing to refine and test the Emma & Roe retail model and consequently this trading update does not include financial information for the Emma & Roe stores.”

During the 12 months, two more Emma & Roe stores opened, taking the chain’s tally to eight versus a target of 10. Another store opened in Brisbane suburb of Mount Gravatt yesterday.

The Emma & Roe (from Emma, Sir Michael’s daughter, and Roe, Lady Christine Hill’s maiden name) story began back in 2012 with the trial of five south east Queensland outlets under the trading name ‘Captured Moments’. All Emma & Roe remain in Queensland.

The stores carried unique jewellery collections consisting of bracelets and charms along with matching jewellery. ‘Captured Moments’ was viewed as complementary to the Michael Hill brand which focused on diamonds, bridal and fine jewellery.

Michael Hill declared the trial a success and in April last year when it opened the first Emma & Roe store.

In its 2014 annual report the company said it would continue to test the business and its multi-channel strategy would help build faster brand recognition across Australasia and open the way to spearhead the brand name into North America through the Michael Hill stores.

Among Michael Hill’s priorities for the 2014-15 financial year was to open four Emma & Roe stores across Australasia and prove up the model for further expansion. – Mike Booker

http://retailnews.co.nz/2015/07/emma-roe-a-charmed-life/?utm_source=rss&utm_medium=rss&utm_campaign=rss

[winner69]

Another year passes for MHI and share price seems ensconced below a$1, that's down 20% from a year ago.

Reduced dividend, investing for growth, Michael handing over to Emma all make for interesting times ahead. Maybe a year to sort all things out.

Wonder how it will all go?

I'll keep watching. Love retail stocks ......and diamonds and things.

[LAC]

Visited one of the Emma n Roe stores recently, still not sure what market he is trying to target there....its too flashy for the type of product on offer, and too over priced for the type of product on offer. I think the $ would have been better spent on something like Lovisa...those store are always busy. And well priced for the teen market who tend to buy more and more every few weeks.

[Crisis]

Michael Hill is aiming to break the USA market as a designer that he could not do as the Chairman.Old is gold - yes?http://www.3news.co.nz/business/meet-michael-hill-designer-2015091109#axzz3lW2MYIa1

[blackcap]

https://www.nzx.com/companies/MHI/announcements/280529
Looks like a good quarterly result. USA sales up 38%. Even the Australian figures were up 4% - better than I would have expected, given their economy.

I just had a read, and yes it looks very good. Same store sales up across the board, Australia may have turned the corner slightly and the US and Canada where future growth will come from looking good. Nice to see Emma Roe doing ok as well. Total Store sales up 8% (off course a few stores opened during the quarter) but that is very good from a company that can fund store openings organically. I see they are still at $1, I did buy some last week but might have to do some more toe dipping.

[Bjauck]

https://www.nzx.com/companies/MHI/announcements/280529
Looks like a satisfactory 9-month result. USA sales, although small, up 28%. Even the Australian figures were up 4% - better than I would have expected, given their economy.

[benjitara]

I bought in at 87? a few months ago on the fact that emma + roe and organic expansion seemed to be going soundly. Their tax issues may effect their recorded profits but not underlying going forward. I'll continue to hold and can see the stock resuming a modest climb into the 1.10-1.20 mark where they historically have been around.

[eew59]

I bought in at 87? a few months ago on the fact that emma + roe and organic expansion seemed to be going soundly. Their tax issues may effect their recorded profits but not underlying going forward. I'll continue to hold and can see the stock resuming a modest climb into the 1.10-1.20 mark where they historically have been around.

If they are found to be under calculating tax the corrected calculation will be applied to future profits which will reduce future earnings.

[Bjauck]

MHI is seeking o have its primary listing in Australia as "this will provide the Company with direct access to a wider group of investors than we currently enjoy and we believe this will be to the benefit of all of our shareholders."
https://www.nzx.com/companies/MHI/announcements/280720

Is this going to be another case of a successful NZ company further sliding out of NZ ownership. The proportion of NZers wealth in shares is still small compared with other countries. There should be no reason why NZ could not support a company that receives most of its revenue and income from overseas operations and sales.

It is ironic to see this market release so soon after figures have been released that indicate that NZ's already very expensive real estate has become even more expensive. Money is puring into Housing yet MHI feels the need to move off-shore to access a wider group of investors. International firms in other countries never seem to have this need as often as NZ companies seem to have. For example Nokia, a massive company, stayed in small Finland despite its Finnish operation be a small part of the total.

[Everwood]

Will this change any issues around tax for New Zealand Shareholders since the primary listing will be on ASX? It said "new Australian incorporated Group parent company acquire all the shares in the company by an exchange of shares on a one for one basis."

[Bjauck]

Will this change any issues around tax for New Zealand Shareholders since the primary listing will be on ASX? It said "new Australian incorporated Group parent company acquire all the shares in the company by an exchange of shares on a one for one basis."

In the last financial year, I don't think that MHI had any imputation credits attached to its dividends. I guess that if it becomes an Australian company with a secondary NZ listing, then dividends will be paid without NZ RWT deducted (DYOR). All future events would also be undertaken with their tax and other effects on Australian shareholders of prime concern.

The terms of the scheme of arrangement will be important and hopefully has guidance as to the tax effect for NZ shareholders.

[scamper]

Although there has been a steady sp increase over the last three months (~95 cps to 117 cps) it seems of no interest to sharechatters here.
Is it really one big yawn? Does one care if its primary listing is asx? Will it be a big fat pain at tax return time?
Scamper's best advisors (sharetrader site) seem to be on holiday! Help please.

[blackcap]

Although there has been a steady sp increase over the last three months (~95 cps to 117 cps) it seems of no interest to sharechatters here.
Is it really one big yawn? Does one care if its primary listing is asx? Will it be a big fat pain at tax return time?
Scamper's best advisors (sharetrader site) seem to be on holiday! Help please.
I think it will be ok for its primary listing to be in Australia. Now that they are going ahead with Emma and Roe and by all accounts it is cheaper to roll out than existing MHI stores and just as profitable this could be a huge growth opportunity.
Also the NZ subsidiary will need to pay income taxes, which will generate imputation credits which the Australian parent company can attach to dividends paid to NZ resident investors.... so surely that is a good thing from a tax point of view as currently they do not pay imputed dividends.
Either way the only concern about a primary listing in Australia is that liquidity may become even less (spread amongst 2 exchanges) but other than that I do not have any problems with the arrangement.

[scamper]

Many thanks blackcap. If I read you correctly, 'doing nothing' and ending up with asx shares is the better option? Cheers.

[blackcap]

Many thanks blackcap. If I read you correctly, 'doing nothing' and ending up with asx shares is the better option? Cheers.

Im not 100% sure on that one. Everyone's situation is different, but for most kiwi holders I do not think its going to make that much of a difference either way. I think you can still have MHI shares tradeable on the NZX if you wish but there may be real liquidity issues there although the "arbitrage" opportunities should keep prices reasonable in line.

[DarkHorse]

I think it will be ok for its primary listing to be in Australia. Now that they are going ahead with Emma and Roe and by all accounts it is cheaper to roll out than existing MHI stores and just as profitable this could be a huge growth opportunity.
Also the NZ subsidiary will need to pay income taxes, which will generate imputation credits which the Australian parent company can attach to dividends paid to NZ resident investors.... so surely that is a good thing from a tax point of view as currently they do not pay imputed dividends.
Either way the only concern about a primary listing in Australia is that liquidity may become even less (spread amongst 2 exchanges) but other than that I do not have any problems with the arrangement.

I agree with you blackcap. I'm most interested in the potential of Emma and Roe. Only two brokers appear to follow the stock (according to 4traders) and it seems have been off the radar and potentially undervalued in recent years, given it still has significant growth potential in Canada and now with Emma and Roe. Any thoughts on that from others in the ST community???

[Rainmaker]

Any one has an idea why there seems to be a trade freeze on MHI?

[winner69]

Any one has an idea why there seems to be a trade freeze on MHI?

You are now a shareholder in an Australian company be listed on the ASX

Starts trading again next week sometime i believe

[Rainmaker]

You are now a shareholder in an Australian company be listed on the ASX

Starts trading again next week sometime i believe
Oh, I see. Thanks

[Bjauck]

Many thanks blackcap. If I read you correctly, 'doing nothing' and ending up with asx shares is the better option? Cheers. Presumably dividends paid by the now Australian Michael Hill International with its main listing on the ASX will become part of a NZ taxpayer's "Overseas Income" even if you own the NZX-listed shares? As with dividends from the NZX listing of the Westpac etc? Is that correct?

[blackcap]

Presumably dividends paid by the now Australian Michael Hill International with its main listing on the ASX will become part of a NZ taxpayer's "Overseas Income" even if you own the NZX-listed shares? As with dividends from the NZX listing of the Westpac etc? Is that correct?

Things looking better and better.

https://nzx.com/files/attachments/239092.pdf

It has opened strongly in Australia as well with bids at 1.15 or 1.21 NZ equivalent. I see a trade has gone through in NZ at $1.31 but that may be a "rogue" trade!

Well maybe I was wrong. The Aussies do seem to value a good growth company more than the kiwis. Bid at 1.24 in Australia and going through at 1.25 which does equate to 1.31 in NZ :)

[blackcap]

Bid 136 In Australia now which makes that a 144 equivalent NZ. This has really taken off, maybe the Fat Prophets buy recommendation has helped, as has the listing in Australia. Nice move the last 3 months.

[blackcap]

So no one going to talk about this stock with a 50% gain in the last 4 months?

Interesting that a move to the Australian exchange has been a catalyst for a re-rating. Lets hope for the NZX's sake that not more companies decide to go this route....

[Bjauck]

So no one going to talk about this stock with a 50% gain in the last 4 months?

Interesting that a move to the Australian exchange has been a catalyst for a re-rating. Lets hope for the NZX's sake that not more companies decide to go this route....
The move of the primary listing to the ASX does seem to have given a boost to the SP, perhaps because more Australians have become comfortable with investing in an "Australian" company. This is a pity for developing a NZ share market with a greater capitalisation. I repeat what I said in April in my post at #466 (http://www.sharetrader.co.nz/showthread.php?638-MHI-Chart&p=615703&viewfull=1#post615703)

[blackcap]

The move of the primary listing to the ASX does seem to have given a boost to the SP, perhaps because more Australians have become comfortable with investing in an "Australian" company. This is a pity for developing a NZ share market with a greater capitalisation. I repeat what I said in April in my post at #466 (http://www.sharetrader.co.nz/showthread.php?638-MHI-Chart&p=615703&viewfull=1#post615703)

Agree with what you said in that post. I think that and coupled with being listed in Australia now its on the radar of the Australian researchers and just recently Fat Prophets have put a buy on this stock. I did expect a marginal lift in stock price but not this much. I am presuming (perhaps incorrectly) that this stock will also now be able to give franking credits in Australia, which will make it more attractive to the Australian investor....
That said not complaining about the move just miffed by the ferocity and scope.

[DarkHorse]

It's grown steadily for so long, I guess it's become too familiar to be appreciated by NZ investors - seemed very cheap a few months ago. Still room for new stores over the ditch - plus plenty of potential in Canada and added possibilities from Emma and Roe

[blackcap]

It's grown steadily for so long, I guess it's become too familiar to be appreciated by NZ investors - seemed very cheap a few months ago. Still room for new stores over the ditch - plus plenty of potential in Canada and added possibilities from Emma and Roe

Thats the thing DarkHorse, there is so much room for growth and it is all organic, or better put, funded from cashflow. I do not see why they were so discounted a few months ago. Same store sales keep growing too... unbelievable.

[blackcap]

Up to $1.61 now. I cannot for the life of me think that the re-rating has happened just because of the Australian Listing?? Anyone else out there venture something different? Because if that is the case, surely there would be a rush to list one's stock on the ASK rather than NZ?
I know Michael Hill have most of their revenues across the ditch so it makes a lot of sense but still, and volumes are huge compared to what they were pre ASX listing.
I see ACC have decided to sell so maybe its some buyers across the ditch purchasing the ACC stake in bundles and things will die down again once that is over?

[benjitara]

Up to $1.61 now. I cannot for the life of me think that the re-rating has happened just because of the Australian Listing?? Anyone else out there venture something different? Because if that is the case, surely there would be a rush to list one's stock on the ASK rather than NZ?
I know Michael Hill have most of their revenues across the ditch so it makes a lot of sense but still, and volumes are huge compared to what they were pre ASX listing.
I see ACC have decided to sell so maybe its some buyers across the ditch purchasing the ACC stake in bundles and things will die down again once that is over?

I sold out the day before the report last week. I can't justify the share price being anywhere near what it is although I'm very conservative with all my valuations and only really buy into value situations.

Their growth prospects with emma and roe are sound but the medium term growth prospects seem to be well and truly priced at the moment.

[h2so4]

I sold out the day before the report last week. I can't justify the share price being anywhere near what it is although I'm very conservative with all my valuations and only really buy into value situations.

Their growth prospects with emma and roe are sound but the medium term growth prospects seem to be well and truly priced at the moment.

Good call.
I've followed MHJ since 2010 but never invested. Can't see what the fuss is all about. MHJ no different now than what it was in 2010.

[blackcap]

I sold out the day before the report last week. I can't justify the share price being anywhere near what it is although I'm very conservative with all my valuations and only really buy into value situations.

Their growth prospects with emma and roe are sound but the medium term growth prospects seem to be well and truly priced at the moment.

Well done. I do see good growth with MHI and its organic so I am holding for the moment. But this surge from $1.00 to $1.61 has come at such a pace and that is what I am querying. Nothing has changed as far as I can see in the last few years and I am sure its not the latest report that has given the stock the spurt.
At $1.00 I thought they were a bargain, not too sure what to think at these prices. Reasonably high forward looking PE now but the Canada situation is looking very good, that market could get as big as Australia and then who knows what Emma and Roe will do. Time will tell.

[LAC]

Any ideas why this SP keeps going up? They have done nothing outstanding Imo yet the price keeps rising. Anyone has ideas on why this is the case? Or is it just that they have more punters on the ASX?

[blackcap]

Any ideas why this SP keeps going up? They have done nothing outstanding Imo yet the price keeps rising. Anyone has ideas on why this is the case? Or is it just that they have more punters on the ASX?

Pretty much exposed to a totally new market... that is the ASX. One of the analysts there, Fat Prophets, rated them a buy when they first listed in Australia. Quite scare as this may be the catalyst for more NZ stocks moving bourses.....

[LAC]

Pretty much exposed to a totally new market... that is the ASX. One of the analysts there, Fat Prophets, rated them a buy when they first listed in Australia. Quite scare as this may be the catalyst for more NZ stocks moving bourses.....
Yeah scary for sure, will be interesting times when TIL gets on there. Not saying that MJH isnt a good company but TIL would be "very" interesting

[blackcap]

Yeah scary for sure, will be interesting times when TIL gets on there. Not saying that MJH isnt a good company but TIL would be "very" interesting

I could be wrong but the volume in MHJ seems to have appreciated considerably since its Australian listing. So a lot more interest shown from over there and a lot of the crossing going on here in NZ will be buyers from Australia purchasing from NZ holders in arbitrage type plays. I did see ACC had decided to reduce its stake and considering the rapid price in crease I can understand that. I bought some at 94 cents a few months ago and am wondering whether I should take some off the table too.
Also now they have paid the tax bill they should be able to pass on NZ imputation credits with dividends and their latest sales growth looks promising so this all adds weight to the increase in share price.

[blackcap]

This outfit has just become a SSH...

https://www.bennelongfunds.com/

The recent price surge now surely down to Australian institutional interest.

[macduffy]

This outfit has just become a SSH...

https://www.bennelongfunds.com/

The recent price surge now surely down to Australian institutional interest.

"Discovered" - and now telling us the good news. ;)

https://www.livewiremarkets.com/wires/33753

[DarkHorse]

Can anyone explain the large drop today? First quarter figures OK and no trading news over last few weeks.

[winner69]

What's up with MHJ

Now 135 - wasn't that long it was pushing 200

Almost back to pre ASX listing price

[benjitara]

What's up with MHJ

Now 135 - wasn't that long it was pushing 200

Almost back to pre ASX listing price

This stock outran its fundamentals by a large margin in my calculations...
I bought in at 85 sold at 1.57 and wouldn't buy in until around the 95 cent mark as of now either...

Good growth stock possibly but that growth will not happen overnight as the stock price suggested in my humble opinion

[vici]

Yeah I was wondering the same thing why it dropped 10% in a day. Doesn't seem to be any single event that caused the price to suddenly drop, however agree with benjitara that the price ran ahead of its long term valuation.
In saying that, I do like its medium to long term growth prospects. Seems to be reaching saturation/maturity in Aus and NZ but from the looks of things they've cracked the formula in Canada and should be able to roll new stores out full steam, and beginning to turn things around in the US

[blackcap]

Yeah I was wondering the same thing why it dropped 10% in a day. Doesn't seem to be any single event that caused the price to suddenly drop, however agree with benjitara that the price ran ahead of its long term valuation.
In saying that, I do like its medium to long term growth prospects. Seems to be reaching saturation/maturity in Aus and NZ but from the looks of things they've cracked the formula in Canada and should be able to roll new stores out full steam, and beginning to turn things around in the US

Pretty much what you say sums up my thoughts. I think the initial exuberance was due to the Australian listing effect etc and also some good numbers. But I will not be selling, long term if NZ and AUS continue to provide good margins and Canada and the US get moving this could become rather large. Nice also that new stores are being rolled out organically and from existing cash flow. Emma and Roe could be the icing on the cake if that takes off....

[James108]

Would anybody be able to help shed some light on the tax situation of this company. The 2016 annual report says that "the final dividend will be fully franked and imputed" however it appears that no imputation credits are attached.