RBD - Restaurant Brands

[Snoopy]

http://www.bizjournals.com/columbus/...0/daily17.html

You post a link about Starbucks closing restaurants in the USA 'funguspudding'. Dare I suggest that this is a truffle pessimistic. The chain is planning to close a net 400 stores out of 16000, a total of 2.5%. And most of those that are to be closed have been opened in the last three years. This isn't actually that many stores, as a percentage.

RBD operate 44 Starbucks stores across NZ. Last year they closed 3 stores, which represented 6.4% of the NZ total. So the cutbacks in NZ have already been far more drastic than those which are proposed in the US, in percentage terms. What is more EBITDA profitability improved from $3.6m to $3.8m in NZ, despite those store closures.

You could argue RBD are ahead of the overseas trend already. I don't believe your implied forecast of a further 'retreat' for Starbucks in NZ is justified.

I am not sold on RBD's involvement in Starbucks myself. That's because I believe that after corporate costs are taken into account, Starbucks in NZ is loss making and has been since FY2005. This isn't the fault of the Starbucks 'concept' as such. It is IMO a result of Starbucks being 'top heavy' in management in New Zealand, and the holding company carrying too much debt for the Starbucks sub concept to be profitable. I think RBD has already streamlined some KFC and Pizza Hut head office management. Perhaps they should do the same with Starbucks? Or perhaps Starbucks can not inherently generate sufficient profits to have a third party corporate (RBD) clipping the ticket on the way through?

I am bemused by the Starbucks strategy myself. In Christchurch the three central city stores are all within five minutes walking distance of each other. That surely must result in sales cannibalisation. Yet all three stores seems to have a steady trade of customers each time I pass them. And this is exactly the kind of store distribution that 'works' in large overseas cities, which have a Starbucks on each corner.

SNOOPY

[biker]

You post a link about Starbucks closing restaurants in the USA 'funguspudding'. Dare I suggest that this is a truffle pessimistic.


SNOOPY

Very Droll :-)

[Snoopy]

Um, er, I don't recall implying anything. I merely posted a link, with a question as the heading. Your response is interesting apart from the strange claim that I was forecasting something.

I don't wish to make a big deal out of this. But your question in the header was:

"Sign of things to come?"

My concise Oxford (1) Definition of the word forecast is: 'conjecture beforehand'. That is exactly what your header is - a forecast by definition! Granted you did not say whether you 'agreed' or 'disagreed' that the retreat of Starbucks in the USA will flow through to N.Z.. But consider this:

1/ You posted a link that makes a point and raise the conjecture "Sign of things to come?"
2/ You make no further written qualification on your referenced listed link.

I think 99% of people would assume you agree with the facts in the linked article and you believe the decline of Starbucks in the USA is directly relevant to a future decline of Starbucks in N.Z., especially given you posted on this RBD thread.

*I* certainly thought that was what you meant.

Bricks titled his reply post "Nothing To Do With Nz.. " so he obviously thought your reference was posted because you thought it relevant to N.Z..

Deev8 titled his reply "How bad will it be for Central Ohio?"

Then said in his post
"Details on how the closures will affect Central Ohio, which has more than 90 shops and kiosks, weren't available." *We will be on the edge of our seats awaiting those details.*

That highlighted piece between the asterisks indicated sarcastically that whatever happens in Central Ohio is likely to be of little relevance to N.Z. (so Deev8 thought you were thinking of your article as a portent to what could happen in N.Z.)

Go back to your post 'funguspudding' and see if it could have been interpreted in *any other way* than the way myself, Bricks and Deev8 interpreted it.

If you were trying to present any alternative interpretation you would have to have presented your linked message in a more different way. I don't think my own comprehension skills have failed me in this instance.

SNOOPY

[Snoopy]

BUY the BARGAIN..

I have a bone to pick with you Bricks (or should that be a stone?)

WILL YOU PLEASE QUIT BUYING RBD SHARES!

I am waiting for the price to go lower into my buy zone, willing it down, down, down and it never does get there. So just quit buying will you!

Funnily enough for all the flack we have taken over the years Bricks, over the last two years RBD shareholders have done quite well as the rest of the retail market has melted down around them. Who would have thought two years ago that RBD would turn into the best (NZX) retail investment of all!

Well two years ago I knew that it would turn out like that eventually, but I didn't know when and I didn't expect it to be 'number one' so soon. It is nice to be enjoying the payoff from all of those (now) increasing dividends at long last!

I went into my 'local' last week to cash in my shareholder freebie burger voucher. I thought I would try some 'wicked wings' as a side but was told they had sold out! Looking around there didn't seem to be a shortage of customers although come Sunday night there was no free newspaper to read (do KFC still have those?). The menu seems to have got simpler since the last time I went to KFC. There is no sign of the "twisters", for example, and there was only one kind of chicken on offer (I see that RBD have reintroduced the option of bonesless fillets this week). All good news in terms of streamlining the ship. Was it my imagination or were they turning the customers around faster?

But in more bad news for my buying program, RBD was up another 2c today. Arrrgh!

SNOOPY

discl: hold RBD

[duncan macgregor]

I have a bone to pick with you Bricks (or should that be a stone?)

WILL YOU PLEASE QUIT BUYING RBD SHARES!

I am waiting for the price to go lower into my buy zone, willing it down, down, down and it never does get there. So just quit buying will you!

Funnily enough for all the flack we have taken over the years Bricks, over the last two years RBD shareholders have done quite well as the rest of the retail market has melted down around them. Who would have thought two years ago that RBD would turn into the best (NZX) retail investment of all!

SNOOPY

discl: hold RBD

SNOOPY exactly two years ago the share price was $1-25 today it is 86c. You would have to be a real nutter to think that was a great return. Macdunk

[Snoopy]

SNOOPY exactly two years ago the share price was $1-25 today it is 86c. You would have to be a real nutter to think that was a great return. Macdunk

According to the 'Sharechat' charts the price two years ago was $1.10.

Actually you are right Macdunk. I was looking at the one year chart where the share price was 80c a year ago. It is now 86c and add to that the 6.5c of dividends received over the last 12 months makes a total of 92.5c. That is a 15.6% return after tax. Not too shabby at all, and it beats you Australian cash holdings which is of course the main thing :-).

Come to think of it though, even though I was looking at the wrong chart, the two year return is still -7.5% per year. I think I might still be right! Is there any NZX retail share out there that has performed 'better' over the most recent two year period?

SNOOPY

[duncan macgregor]

Sorry to say SNOOPY you should learn to read charts. If you go to direct broking site, get into super charts look up rbd over a two year period from today it starts at $1-25. You might be interested to know that MHI is about where it was two years ago, which is still a dead loss in the uptrending market we had during that time. Take into account some of us more than doubled our money in that period with the more astute investors taking their money to Australia, and sitting on a 13% exchange gain in that period. I have told you for years now that you will end up losing the lot on this dog of a company. The straw that broke the camels back was when they sold the kennels to go on that overseas trip, leaving them paying rent in this the bad times. Incidently i am sitting out the market this year, after predicting the market would downtrend leading up to a crash. Know when to play the game SNOOPY, and know when to stand aside, learn a sell system or you will go under bleating about how right last years fundamentals are. Macdunk

[Snoopy]

Sorry to say SNOOPY you should learn to read charts. If you go to direct broking site, get into super charts look up rbd over a two year period from today it starts at $1-25.

Hmmm, you seem to be right. I am too though. The sharechat two year chart definitely shows $1.10

You might be interested to know that MHI is about where it was two years ago,

OK, so one retailer has outperformed RBD. Good on ol' Mike

Take into account some of us more than doubled our money in that period with the more astute investors taking their money to Australia, and sitting on a 13% exchange gain in that period.

Are those the same astute investors, that after doubling their money in the first year, then invested in PEM which subseqently declined from over $3 to just 67c as of yesterday in just twelve months? A near 80% decline?

That would give a two year return on capital of: 2 x 0.2 = 0.4

IOW a net result of losing 60% of your investment capital in just two years. Perhaps Macdunk you are referring to a new meaning of 'astuteness' with which I am unfamiliar?

And IIRC these same astute investors got their original seed capital by selling out of PGW on the NZX, which over the comparable two year period produced a return of +80%?

Incidently i am sitting out the market this year, after predicting the market would downtrend leading up to a crash. Know when to play the game SNOOPY, and know when to stand aside.

Oh it hasn't been an easy market. I have made some big losses and some big gains this year. Overall though my NZX investments are about even. I haven't seen losses anywhere near those that most investors on this forum seem to have suffered. And meanwhile those dividends just keep rolling in! I think I have a good chance of outperforming Aussie cash over the next 18 months by just sticking to my NZX knitting.

SNOOPY

discl: hold CEN, LPC, NZS, PGW, RBD, SCT, SKC, TEL, TUA

[BRICKS]

DOUBT the price will go below .83 cents that's my bench mark if it does Great BUY,,
At Rotorua has two stores KFC one Palm Springs has been done over and full of Happy faces,
Well in the main town is indeed of a need for a work over a lot of money has passed over the counter there but always full Japs and things as the stores are out for three months this store may be down the List..

AS for Mac Duck the quicker he finds out a "DOG" is what humans take for a walk so they can mess up the place and nothing to do with RBD..

[duncan macgregor]

SNOOPY, Thats why the more astute investors have stop loss systems to save them from themselves when they buy a stock that goes the wrong way. look at the ammount of money you have lost riding RBD down over the years bleating about dividends buying more and more, which is worth less and less. Nobody ever gets it 100% right all the time at the buy time, the idea is to take the small loss admit your mistake to yourself and dump the company. The market is now starting to crash you would be well advised to change your methods before its to late. Macdunk