Might even go higher ...that be good eh
Even if 40 cents for the year guys like Snoopy and his expected return of 7%(I think) would be happy to pay $7 for HLG
Wonder if Snoopy has any HLG in his portfolio
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OK ...complimentary then
That Specialty Fashions in Aussie that Grahger have a holding in has got rid of all their dud brands (Glassons killed them ha ha) and putting everything into City Chic which is a market leader in the plus-size women’s apparel market with strong online global sales.
Even more complimentary / diversified retail portfolio
many comments about the stunning increase in profits. Which they were. But a 16% increase in revenue. Whoa. To provide a point of comparison, KMD, which is performing well, said its revenues for the ~11 month period to 24 June (July year end) were up 7.7%. HLG whacked it out of the park.
Revenues up 16% and npat up 58%
Management have done wonders improving Gross Margin (several key factors affect this) as well as managing the cost of doing business.
Npat margin increased from 7.4% to just under 10.0% ......a whopping 2.6% points ...on $277m sales that’s a cool $7m of efficiencies / productivity achieved (and profits are up about $10m so a decent chunk of the gain)
Good selling heaps more stuff but Margin/expense management is just as 8mportant. HLG have been masters of this for years.
Pretty fantastic eh.
Agreed. Truly stunning sales growth. As expected our new Australian guru institutional investor is happy to soak up all the shares they can pry from weak holders hands at ~ $5.50. They must be LOV ing gabbing such a bargain off gullible Kiwi holders who can't understand the outstanding growth potential Glassons has in Australia.
Lots of respect for you BP but I disagree with you on this one They have shown that the result wasn't just on the back of one bumper summer. Today at $5.50 the market affords the company a PE of 12
-It has no debt,
-Great and growing online presence,
-Stunning increasing sales - in order the rates of 6 monthly (winter /summer seasons) increases on the pcp are 9%, 5%,19%, and today's winter PCP increase 13%
-Dominant incumbent player in its well targeted market.
-Large imputed, consistent and now growing dividends.
But wait there's more!.... Now we have expansion happening as we speak on a proven formula in Aussie. Surely HLG should have a PE under these circumstances of at least 14-15.
Even at the historical PE of 13 the share price should be $5.95 today. So IMO the market has not fully price in the result yet.
There is no doubt HLG are very good at what they do and without question my favourite retail stock in NZ due to no debt and good management. BUT don't get to starry eyed as the NZD is below 67c and this will start to hurt them. The weakening NZD will have had no impact on FY18 and might not hurt H1 19 too much but if it stays here by H2 19 profitability will slide.
My model forecast $276m sales and $26.7m npat so pretty close for FY18 looks more like $21-22m npat for FY19 if the NZD stays around 66c. Appreciate all the unknowns at this early stage, and HLG will continue to execute better than most but I've sold a third because the risk-return at these levels is not as compelling to me. $22m for FY19 put them on 15x at $5.50.
I'd like to be mocked wholeheartedly in 12 months time as I still have quite a few on board....