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  1. #21
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    Quote Originally Posted by Dr_Who View Post
    Briscoe warns of slashed profits

    OUCH! Bad time to be in retail stocks. Cant see NZ economy recovering anytime soon.
    The warning signs were out for the retail sector months ago, so it shouldn't have been such a surprise...
    Death will be reality, Life is just an illusion.

  2. #22
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    BGR looks like making the next step forward in current trend.

    Fortunately, the GFC finally forced them to get those corporate costs under control. Signs are out that Christmas might have been good. With the lower cost structure, BGR has the potential to surprise to the upside this year and maybe next.

    My valuation currently about $1.48, but with upside. This stock could really do with some liquidity though.

  3. #23
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    Quote Originally Posted by Lizard View Post
    BGR looks like making the next step forward in current trend.

    Fortunately, the GFC finally forced them to get those corporate costs under control. Signs are out that Christmas might have been good. With the lower cost structure, BGR has the potential to surprise to the upside this year and maybe next.

    My valuation currently about $1.48, but with upside. This stock could really do with some liquidity though.
    Only way it will ever get liquidity is when Rod sells down and that will NEVER happen.

  4. #24
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    4th Quarter / Full Year Sales

    The directors of Briscoe Group Limited announce that unaudited sales for the three months ended 31 January 2010 were $147.1 million, being 14.32% higher than the $128.7 million reported for the fourth quarter of last year.

    Homeware sales increased 15.95% to $102.2 million and sporting goods sales rose 10.78% to $45.0 million.

    On a same store basis and adjusted for the quarter just ended being a 14 week quarter (compared to 13 weeks last year), the group’s sales for the quarter were 8.53% ahead of the fourth quarter of last year.

    No new stores were opened by the group during the quarter. The total number of homeware stores remained at 58 with total store area of 94,852 sqm and sporting goods store numbers at 32 with total store area of 53,714 sqm.

    The January 2010 quarter sales figure takes unaudited group sales for the year ended 31 January 2010 to $416.7 million, an increase of 7.26% from the $388.5 million reported for last year. Homeware sales increased 7.01% during this period, while sporting goods sales increased by 7.82%.

    On a same store basis (and adjusted for the 53 week year), the group’s sales for the twelve months ended 31 January 2010 were 4.74% ahead of the same period last year.

    Homeware same store sales increased 4.16% compared with the twelve months of last year, while sporting goods sales increased by 6.02%.

    Managing Director, Rod Duke said, “We are delighted with the overall performance for the final quarter of the year. The market responded very favourably to our marketing initiatives during the lead up to, and throughout the crucial Christmas trading period. This strong trading has also continued during January particularly for our Briscoes Homeware stores.

    “As well as generating a same store sales increase of 8.53% for the group I am pleased to advise that we have also achieved significant margin and profit improvements continuing the trend established in every previous quarter of this financial year.

    “These excellent results incorporate a less than satisfactory performance by our specialty homeware stores, Living & Giving, which operate in a highly discretionary sector that has been severely impacted by the economic downturn. As part of the half year result we made an impairment adjustment of $827K for under-performing assets associated with these stores and it is likely that a further adjustment of about $1 million will be included in the full year result.

    “With the strong finish to the financial year we are confident of producing a second half performance which, as previously indicated to the market, will be significantly ahead of the second half profit reported for last year. We now expect to report a full year tax paid group profit in excess of $20 million. This includes the impact of the additional 53rd week and also the impairment adjustments. But for these two “one-off” impacts we would have achieved a group tax paid profit of around $21 million.”

    The directors expect to report the final full year audited result on 9 March 2010.
    ~ * ~ De Peones a Reinas ~ * ~

  5. #25
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    Arrow DUKE for KING..

    AS Mr Duke has nearly bought up all the the shares and one day turn it into a private company and will not need public money again BRICKS would not waste his time, but
    then he could become a first home buyer and give up his RENTAL..

  6. #26
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    Buy Briscoes today - you'll never buy better!

    DISC: Holder.

  7. #27
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    Default COLIN all your SAYING is...

    Quote Originally Posted by COLIN View Post
    Buy Briscoes today - you'll never buy better!

    DISC: Holder.
    IF Mr DUKE wants all the shares he will have to buy them off COLIN.. Regards..

  8. #28
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    How much of that sale is through cutting the margin? The key is the profit I guess.

  9. #29
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    Quote Originally Posted by The BOWMAN View Post
    How much of that sale is through cutting the margin? The key is the profit I guess.
    Hey - but they've just said that there was "significant margin improvement!"

  10. #30
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    fantastic performance really ...Rod is true retailer

    This and HLG recent announcement puts WHS in really bad light doesn't it .... market really not that bad after .... have what punters want and they come and buy .... instaed of going to The Warehouse

  11. #31
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    Quote Originally Posted by COLIN View Post
    Hey - but they've just said that there was "significant margin improvement!"
    Oh, missed that. So far the report season started with a good note, hopefully more positive reports coming out and turn the market sentiment a bit. After all, this should be a recovery year.

  12. #32
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    Retail is very difficult at present.Appears someone forgot to tell Rod Duke .
    This an outstanding result.

  13. #33
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    Quote Originally Posted by percy View Post
    Retail is very difficult at present.Appears someone forgot to tell Rod Duke .
    This an outstanding result.

    Thats becuase is one of few retailers in NZ .... retailing is in his blood ... he has a canny sense of knowing what punters want and how to make a buck out of them .... that to a large extend is an art .... more so than a science ... it comes naturally to him .... he is a rare breed and doesn't get the recognition he deserves

  14. #34
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    I have just posted this on the WHS thread, but it seems relevant to include it here!


    Rod Duke continues to prove himself to be one of the countries most capable retailers.

    In my opinion Stephen Tindall used to be one of the countries most capable retailers.

    I'm not sure about the current Warehouse management or strategy. They have gone a little more upmarket in terms of layout, quality and prices and don't have the constant sales that used to appeal to a lot of people (or was it just me?)

    I'm not sure any of these things suit the Warehouse brand that was created over a couple of decades? It seems they have tried to become a bit of a 'me too' (like Dick Smiths have just done) shop and have perhaps lost some of their appeal because of that?

    Over the past few years I have found myself buying very little from the Warehouse. Briscoes sells better quality gear (in my opinion) for not much more (when it is on sale). If I want CDs and DVDs which I used to buy at the Warehouse I now go to JB HiFi as they have a much better range and are generally cheaper.

  15. #35
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    emerg.
    good post. my wife comes home with nice stuff from briscoes.

  16. #36
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    Second qtr results out and more evidence of tight retail conditions, with quarter down on same time last year, particularly in homewares (sporting goods up - lots of soccer balls I imagine). However, BGR continues to hold its own:

    "Despite the tough operating conditions, Group EBIT has tracked ahead of last year for both quarters and we expect our results for the half year to show Group EBIT ahead of last year by around 30%
    From that, I guess first half profit looks to be around $8.7m, up from prior year of $6.5m. If they can hold steady second-half through the crucial Christmas period, then probably looking at a FY of about $23.5m, or forward P/E a little under 11 at current price of $1.19. Since they're not short on cash, holding or increasing the div is no problem which should put a floor under the price at some point.

  17. #37
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    Quote Originally Posted by Lizard View Post
    Second qtr results out and more evidence of tight retail conditions, with quarter down on same time last year, particularly in homewares (sporting goods up - lots of soccer balls I imagine). However, BGR continues to hold its own:



    From that, I guess first half profit looks to be around $8.7m, up from prior year of $6.5m. If they can hold steady second-half through the crucial Christmas period, then probably looking at a FY of about $23.5m, or forward P/E a little under 11 at current price of $1.19. Since they're not short on cash, holding or increasing the div is no problem which should put a floor under the price at some point.
    Lizard as allways it looks as though you are right on the money with this extremely well run retailer.

  18. #38
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    Liz - Duke indicated that the 1H NPAT result will be similar to last year's $6.5m, after taking into account the extra $2.6m tax adjustment.

    But I agree that the FY11 NPAT result should be slightly up on last year due to the $1.9m write-down of the Living & Giving stores last year that shouldn't be repeated this year (barring any further deterioration of retail conditions).

    Assuming full year forecasts of $23m NPAT ($21m last year) and $45.7m EBITDA ($38.8m last year but Duke indicated 1H EBIT is up 30% on pcp) and net cash position steady at $59m, BGR's fundamentals look like this:

    Current Market cap = $1.19 x 212.15m shares = $252m
    EPS = $23m / 212.15m shares = 0.108
    PE = $1.19 / 0.108 = 11.0x
    EV/EBITDA = ($252m - $59m) / $45.7m = 4.2x
    Gross divi yield = 7.1c / 119 / 70% = 8.5%

    I value BGR at between $1.30 - $1.40 using:
    PE multiple of 12x = 0.108 x 12 = $1.30
    EV/EBITDA multiple of 5.5x = (5.5 x $45.7m + $59m) / 212.15m shares = $1.47
    DCF of free CFs at 11.5% discount rate = $1.42

    The trouble with BGR (and OIC) is that it needs to find a better place for its cash. Either find a decent acquisition or return the $59m (28cps) to the shareholders.
    Last edited by Catalyst; 06-08-2010 at 12:45 PM.

  19. #39
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    The 3rd quarter sales figures were surprisingly good with an increase on pcp of 6.5% - although seems they tailed off in early October after the gst increase. And the outlook statement is rather on the cautious side, so would guess a bit of pressure on margins, despite favourable forex.

    Assuming an unexceptional Christmas period, I would think heading for about $23.8 - $24.1m NPAT for FY11 (excluding effect of extra $2.6m tax).

    Valuation about $1.50, so nothing too exciting, but a steady longer term hold for now.

  20. #40
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    Quote Originally Posted by Lizard View Post
    Valuation about $1.50, so nothing too exciting, but a steady longer term hold for now.
    A steady longer-term hold providing a gross yield of around 8% - not bad in an income-producing portfolio.

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