HLG - Hallenstein Glasson

[RupertBear]

So here we are. Nov. 22 2018. "Sound buying" "Topped up last week"




Dec. 2 2018 "Plenty more growth to come" We really like "long established companies". Yeah, me too.



Dec. 3 2018 Those dirty "naysayers" eh, "wrong then and they're wrong now." It's gotta be a great buy still, right?

But wait, what is this??????



You've sold!!! Half??? What? When? Why?

This monkey is bewildered!

Just that morning you posted about the "naysayers" being wrong. But apparently you've already started selling down? And "a while back" no less!!

Sure, Dec. 3 was a trading update, and it wasn't great. Wasn't quite the end of the world either.

What on earth is going on?

And here folks, is my issue. Mr Beagle, you responded to me yesterday and said, and I quote "anyone who followed this lead dog should be extremely pleased and grateful for the barking". Indeed. So you clearly understand you carry some weight on this forum, and investors should be grateful for following your "lead". But nowhere between you topping up on Nov.22 and announcing you'd sold half your shares on Dec. 3 did you post your intentions to your 'pack' that now was the time to sell. You didn't bark that part did you. In fact, you continued to ramp it up. Ramped it up and sold the story, one you obviously didn't believe any more. And now we have to read about you patting yourself on the back for a job well done, and how we should all be grateful?

So, for all the mum & dad investors, those new to investing, those trying to learn a little bit more, here's the moral of the story:

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

Seriously have you nothing better to do than troll through old posts to garner ammunition to run down Mr Beagle?! I for one value his posts, he has bent over backwards to help newbies like me and I am grateful he takes the time to post his thoughts on here because he doesnt have to. I am actually very interested to hear what he holds and why and what he sells and why, it doesnt mean I will rush out and buy or sell a share soley based on his opinion. Give the man a break and give the rest of us some credit for our ability to make our own decisions. If you cant abide the man, which is the impression you give, dont read his posts!

My sympathy to you for loosing your dog, its heartbreaking when our furry mates die.

[Beagle]

I owned a beagle. Past tense. He died this year on Oct. 26. Very difficult day as we had him since he was a puppy. He was 16yrs old. But after 16yrs I can say I learnt a thing or two about beagles, they "lead" you to only one place, their own food bowl.

In the spirit of the Christmas season I also wish to share my condolences. Its extremely difficult to lose a much loved family member especially an adorable Beagle that one and one's family has grown up with. You were fortunate to have 16 years with such an adorable dog. We had Kelly for 11.5 years and the kids and I adored her but sadly she got inoperable cancer fairly early on and it broke our hearts. We have 2 Sydney Silky terriers now and they are getting on towards 13 years old so I need to store food away for the pending vet bills !

I can confirm that Beagle's love their food, in fact they're obsessed with it. I can't be bothered responding to the rest of your post but have a think about this.
Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ? Beagle's are wonderful and loyal dog's and will bark about the first sign of trouble but ask them to let other monkey's eat first out of their food bowl...you must be kidding lol

[winner69]

My cat died the other day

In his wemory I will remain 'An Awesome Cool Cat' as per my profile

And Monkey my sympathies as well, I know how it feels as we lost a dog a month or so ago as well

[Raz]

In the spirit of the Christmas season I also wish to share my condolences. Its extremely difficult to lose a much loved family member especially an adorable Beagle that one and one's family has grown up with. You were fortunate to have 16 years with such an adorable dog. We had Kelly for 11.5 years and the kids and I adored her but sadly she got inoperable cancer fairly early on and it broke our hearts. We have 2 Sydney Silky terriers now and they are getting on towards 13 years old so I need to store food away for the pending vet bills !

I can confirm that Beagle's love their food, in fact they're obsessed with it. I can't be bothered responding to the rest of your post but have a think about this.
Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ? Beagle's are wonderful and loyal dog's and will bark about the first sign of trouble but ask them to let other monkey's eat first out of their food bowl...you must be kidding lol

I'm going to defend Beagle on this one, we are all adults and you assess tips, information and DYOR, especially when getting in & out. I really did not follow this share and Beagle did put forward a number of good sound arguments on this share, based on his heads up on this forum and my additional research.. purchased a while back on the run up. I also decided when to start to selling down a xoxo holding. Liquidity on this share is tricky and even though it has been mentioned here countless times..you really don't appreciate how tricky until you actually try to sell down. Thanks to his research and my follow up action it has been a rather drama free gain, just taken more time to cash up than I ever appreciated for a substantial six figure gain. I owe him a beer when ever we finally catch up however perhaps I should be paying for his new car. I appreciate the comments from all, it up to me as an adult to assess them.

Full disclosure: I never met Beagle and its fair to say we see a number of things differently and that is okay, we also have one common interest and that is cars.

[Beagle]

Thanks mate. I can send you the dealers bank account for the $20K change-over if you like

[winner69]

Maybe there’s been an over reaction to HLG comments.

All we’ve heard is the market is ‘challenging’ and a hint that ‘margins may be under pressure’

What eventuates I have no idea. All I know is that -

Last year’s npat was $27m
Each 2% increase in sales F19 increases npat ~$2.5m
Each 2% point drop in margin adversely impacts npat F19 by ~$4m
If expenses go up 3% that adversely impacts npat F19 by ~$3m

It’s a bit of mix and match to get an estimate npat for F19

An optimist might say relatively modest 4% sales increase and only 1% margin contraction and increased expenses to give ~$27m about the same as last year ...bloody good eh

The pessimist (maybe market view) is no sales growth with a 3% msrgin contraction and 3% expense increase giving ~$18m npat in F19 ..ouch

My view ...this year not too bad but F20 will be a real struggle.

numbers done in my head but I think they are about spot on

[Ghost Monkey]

Its a very thinly traded illiquid stock. Do you really expect anyone on here to announce their intentions before commencing their action program or is it more reasonable to assume that a Beagle would eat his fill first ?

Of course not. But you've just been caught out talking up a stock whilst you were selling. Does that bother me? Yep. There's a certain moral compass that doesn't appear to be working here.

But is this that unusual? Nope. You're not alone, you're not the first, and you're not the last. I had a friend who ran a team of 4 share traders at one of the world's largest investment banks, in one of the world's largest economies. When he told me that they could actively chart rumours on chat forums affecting share prices and 'exploit' them I realised with dismay that the odds are forever not in your favour, esp if you're small fish like me.

I think I might leave it here. You are welcome to have the last say and feeling free to take some digs. But you obviously missed that my post on Thursday was my own brand of sarcastic humour. But you came out swinging so I swung back. You're a better investor, I don't deny it, and I do read your posts. But I'm also reading through your posts.

And Winner, my own condolences for your dog and your cat. Right before Christmas too, that's not easy.

[Beagle]

Its kind of ironic...I only ever bought for the dividend a couple of years ago. Classic dividend hounds stock I told myself with only a very modest chance of going up much. I never expected them to double in just on 2 years. Funny how things pan out sometimes isn't it. Happy to hold half...I think they're just starting a really great expansion of Glassons in Australia and expect a very solid performance from this company going forward.

Maybe there’s been an over reaction to HLG comments.

All we’ve heard is the market is ‘challenging’ and a hint that ‘margins may be under pressure’

What eventuates I have no idea. All I know is that -

Last year’s npat was $27m
Each 2% increase in sales F19 increases npat ~$2.5m
Each 2% point drop in margin adversely impacts npat F19 by ~$4m
If expenses go up 3% that adversely impacts npat F19 by ~$3m

It’s a bit of mix and match to get an estimate npat for F19

An optimist might say relatively modest 4% sales increase and only 1% margin contraction and increased expenses to give ~$27m about the same as last year ...bloody good eh

The pessimist (maybe market view) is no sales growth with a 3% msrgin contraction and 3% expense increase giving ~$18m npat in F19 ..ouch

My view ...this year not too bad but F20 will be a real struggle.

numbers done in my head but I think they are about spot on

I posted my thoughts on profit earlier this week mate. Currency was under quite a bit of pressure a few months back which is when they probably bought their summer stock. Annual report detailed margin pressure both in the Chairman's and CEO's report and it was mentioned again at the annual meeting so its more than a hint.

Ghost Monkey - I'm not going to get into an argument with you other than to say this. I have made over 11,000 posts and I call things as I see them at the time. I sold half in early August 2018, please see my post above. Things happened so quickly with HLG on the way down I was too busy trying to exit for a good price to post my updated thoughts. I have shared my forecast for 2019 and its up to people to make their own assessment of where they see fair value for HLG now.

If you are interested my top pick and #1 listed investment position for 2019, is OCA and I believe the current price represents a truly compelling investment proposition...just as compelling at $1.10 -$1.11 as when HLG were $2.70. I rate OCA a VERY STRONG BUY - is that clear enough for you ?

[winner69]

I posted my thoughts on profit earlier this week mate. Currency was under quite a bit of pressure a few months back which is when they probably bought their summer stock. Annual report detailed margin pressure both in the Chairman's and CEO's report and it was mentioned again at the annual meeting so its more than a hint.

Ghost Monkey - I'm not going to get into an argument with you other than to say this. I have made over 11,000 posts and I call things as I see them at the time. I sold half in early August 2018, please see my post above. Things happened so quickly with HLG on the way down I was too busy trying to exit for a good price to post my updated thoughts. I have shared my forecast for 2019 and its up to people to make their own assessment of where they see fair value for HLG

So this margin pressure could be more severe than I estimated ...maybe a more pessimistic case than above is worth looking at

Say no sales growth, a 4% points margin contraction and 3% increase in overheads - that would result in npat F19 being $11m/$12m less than last year .. about $15m

Nah, won’t happen ...will it?

[Beagle]

So this margin pressure could be more severe than I estimated ...maybe a more pessimistic case than above is worth looking at

Say no sales growth, a 4% points margin contraction and 3% increase in overheads - that would result in npat F19 being $11m/$12m less than last year .. about $15m

Nah, won’t happen ...will it?

Probably not. I am thinking 58% gross profit margin, expenses up 1-2% and sales up 3% which gets me to about $20 - $23m after tax but its very early days and a lot depends upon the gross profit margin and yes absolutely, they have mentioned its under pressure several times now. Probably just as well we didn't go down or stay down at 62 cents US. $21.5m on 59.6m shares gives eps of 36 cps. Choose whatever PE you think is right...