nice post Ogg..
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nice post Ogg..
WHS has been down trending for more than a decade now and to make matters worse there is a long term Descending Triangle (Bearish) Pattern in play..The !!! alerts the fact that the more favoured chance of a predicted downward breakout may have occurred
http://i458.photobucket.com/albums/q...017%20week.png
Has WHS bottomed out?? the Dragonfly Doji appears at turning points..If WHS gaps up Monday it will confirm as an abandoned baby, a very bullish candle stick sign..If there's no gap up Monday then it will be concerning that primary support may have been broken (beyond the margin of error) and in the chartist's world that is seen as bad news...
http://i458.photobucket.com/albums/q...17%20daily.png
Index tracker funds and some institutions will be selling as a result of this.
Hard to believe they're paying such a big dividend considering the most recent financial performance. Struggle to understand how that's good prudent management given the apparent need for substantial additional restructuring ?
Also struggle to see on what basis Directors and management have confidence in the future of the finance business ? What evidence are they basing this on ? Why are they stripping so much cash out of the company if they're planning or taking more losses on the chin with the finance arm in the hope of turning it around ? How are they going to fund other restructuring costs going forward ?
This dividend hound can see other hounds being very disappointed with the significantly reduced size of their feeds after this current one.
Balance - Top post above mate, couldn't agree more. Noel Leeming the only bright spot on a very dismal landscape.
The financial profile of the group certainly does not support such a high dividend payout policy.
To reinforce one of the points I made above, Roger:
In 2010, WHS operating lease commitments were $180m.
In 2016, the commitments have ballooned out to $811m!
Meanwhile, NPAT has dropped from $83.2m in 2010 down to $64.1m in 2016, and forecast to be between $54m - $58m!
In other words, WHS financial risk has been ratcheting upwards even while the group attempts restructuring after unsuccessful restructuring, acquisition after acquisition.
But for the $100m equity placement in 2014 (shares issued at $3.23 so ain't no likelihood of the institutions putting up their hands for more), WHS would definitely be unable to keep the high dividend payout going.
WOW, so in FY19 when the new accounting standard comes into effect that requires companies to account for lease commitments as liabilities their balance sheet is going to look truly horrible !
I don't follow this one closely Balance but I assume they have gone through a substantial sale and lease back process, really substantial by the look of those scary figures.
Just saw your post Winner. Hard to cut much labor cost either. Lets face it finding a staff member at the Warehouse to help you with your shopping enquiry is already a major mission and don't even start me on the way people have to queue up like cattle already for the very minimal number of checkout's open at any one point although I suppose they could do a K Mart and make people scan and pack their own purchases but how do they then overcharge people 10 cents per plastic bag ?
Note that net debt has gone from a minimal $72m in 2010 to $299m in 2016?
Could be debated that dividends have been all paid from increased borrowings ($227m) and the $100m equity raised in 2014.
All part of the 'efficient use of lazy balance sheet' push by institutions as I recall back in the early 2010s - balance sheet certainly has been working hard since then!
More pressure on WHS here ....
http://i.stuff.co.nz/business/money/...cid=app-iPhone
Or is it cheaper for these guys to takeover WHS to get the footprint ?????
Like each and every other company to which IFRS16 will apply the bringing onto the balance sheet of all these lease liabilities will also be accompanied by the bringing on the balance sheet of an amount of leased assets.
So while some companies will have a net decrease in equity, some will have a net increase in equity and it will probably, more or less, all come out the same colour in the wash.
It is unlikely that the movement in net equity will be 'significant' in most cases.
Best Wishes
Paper Tiger
Disc: Do not hold WHS, I bought some once & did not get a bargain. :(