HLG - Hallenstein Glasson

[winner69]

Young women like things that make them shine...clothes, jewelry, shoes, make-up, you name it. Maybe not all that different.

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

[jg8512]

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.

[sb9]

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.

Well said, they've done extremely well to come out with those sort of numbers.

[winner69]

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.

[Beagle]

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.

[BlackPeter]

Tough crowd to please. 58% profit growth this year on top of 25% last year. Second half profit this year at mid forecast point is $12.25m compared to $8.09m last year so 51.4% profit growth in second half which shows momentum from the stunning summer has carried through well into the second half. Weather conditions were extremely favorable in the first half as was currency but second half performance is still very strong despite less favorable tailwinds from currency and weather. Very strong result and augers very well for FY19.

I just said this morning that the result is probably already priced in. Looks like I was right.

[Patient Panda]

Young women like things that make them shine...clothes, jewelry, shoes, make-up, you name it. Maybe not all that different.

I’d be crazy to say that isn’t true ! Was talking about the economics of the businesses as well as past performance. Nevertheless an amazing result.

[Maverick]

I just said this morning that the result is probably already priced in. Looks like I was right.

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.

[iceman]

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.

Well put Maverick and pretty much my thoughts as well.

[Arbroath]

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....