HLG - Hallenstein Glasson

[Balance]

HLG, Briscoes and others being discussed on Magic Talk this afternoon and many outraged listeners voicing their anger and suggesting boycotts at companies taking the wage subsidy while making decent profits and paying dividends. HLG is very guilty on this front and personally I think it is morally wrong.

So let's review what happened, shall we?

The wage subsidy was made available to ALL companies based upon the criteria * below - so that employers and companies KEPT staff on, while still paying the staff Kiwisaver, ACC and holiday pay etc.

Nobody knew at that time how grave the downturn was going to be and how bad things were going to get.

But almost all non-essential companies met the criteria * because the lockdown resulted in many instances 100% drop in revenues, let alone 30% drop in revenues.

Some companies have gone into receivership, even after receiving the subsidy while some others like Briscoe & Hallenstein, because they are very well managed, have somewhat recovered the loss in revenues and profits due to the lockdowns.

What the 'outraged' listeners are effectively saying is that :

1. If a company or employer loses money and goes broke, and their employees lose their jobs - then that's okay for said companies to get the wage subsidy.

2. If a company manages to do well and keeps all their staff, then said companies are at fault?

I say to the 'outraged' listeners : Get ... and Get a life! You are going to reward losers but punish winners?

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

* Criteria :

"Your business has experienced a minimum 30% decline in actual or predicted revenue:

over the period of any month from January 2020 through to the end of this scheme when compared to the same month last year, or a reasonably equivalent month for any business operating less than a year;

and

that loss is attributable to the COVID-19 outbreak;

and

your business has taken active steps to mitigate the impact of COVID-19 on their business activities (such as engaged with your bank, Chamber of Commerce, industry association or the Regional Business Partner programme);

and

you agree you will, using best endeavours, retain the employees named in your application in employment on at least 80 percent of their regular income for the period of the subsidy."

[Beagle]

HLG, Briscoes and others being discussed on Magic Talk this afternoon and many outraged listeners voicing their anger and suggesting boycotts at companies taking the wage subsidy while making decent profits and paying dividends. HLG is very guilty on this front and personally I think it is morally wrong.

I disagree. HLG had to close their stores in Australia and New Zealand for an extended period of time. The wage subsidy was set up to keep employees in work which is what HLG used it for and I note their profits in 2H were well down on last year. If their profits increased in 2H FY20 compared to 2H FY19 there could be some moral dilemma that the spirit of the wage subsidy system had been breeched but the way I see it is HLG were well and truly entitled to claim the wage subsidy.

I'd go further and say good on HLG for taking the wage subsidy and keeping people in work when it clearly cost them money to do so, despite the wage subsidy reimbursing some of their costs.

[Balance]

I disagree. HLG had to close their stores in Australia and New Zealand for an extended period of time. The wage subsidy was set up to keep employees in work which is what HLG used it for and I note their profits in 2H were well down on last year. If their profits increased in 2H FY20 compared to 2H FY19 there could be some moral dilemma that the spirit of the wage subsidy system had been breeched but the way I see it is HLG were well and truly entitled to claim the wage subsidy.

I'd go further and say good on HLG for taking the wage subsidy and keeping people in work when it clearly cost them money to do so, despite the wage subsidy reimbursing some of their costs.

Exactly, Beagle - The Labour Government set the rules and now, we have Labourites fanning hatred against companies which managed to ride through the crisis & deliver returns for their shareholders - go figure 1.

Meanwhile, the PM is still defending the $12m to the private '$28,000 a year school fees' Green School as appropriate. Go figure 2.

[Waltzing]

"launched a US website"

Really no ! well i am frankly surprised they survived in AUS. NO surely they wont try and open a store in the US? no surely not! Id be absolutely thrilled for them if they managed to move beyond the south pacific!

From the man who walks in the light...

"What will propel it to $7+ ?. Earnings and dividend yield, you'll see mate."

well we might just have to hold!

The wage sub was required and HLG is the right sort of company to take that and keep it.

[iceman]

I disagree. HLG had to close their stores in Australia and New Zealand for an extended period of time. The wage subsidy was set up to keep employees in work which is what HLG used it for and I note their profits in 2H were well down on last year. If their profits increased in 2H FY20 compared to 2H FY19 there could be some moral dilemma that the spirit of the wage subsidy system had been breeched but the way I see it is HLG were well and truly entitled to claim the wage subsidy.

I'd go further and say good on HLG for taking the wage subsidy and keeping people in work when it clearly cost them money to do so, despite the wage subsidy reimbursing some of their costs.

Far enough but we will agree to disagree. I just want to be clear that I am not saying they did anything wrong and it most certainly is not limited to HLG. Far from it. I just find it morally reprehensible to keep the subsidy while paying out large dividends. But fully understand not everyone will agree.

[Balance]

Anyway, I am picking HLG's sp to be $6.50 to at least on 16 October 2020.

You guys will have to figure out for yourself what is likely to happen next week to drive the sp to that level!

It's actually quite obvious!

[Beagle]

Anyway, I am picking HLG's sp to be $6.50 to at least on 16 October 2020.

You guys will have to figure out for yourself what is likely to happen next week to drive the sp to that level!

It's actually quite obvious!

I'm going to take the bait..come on, spill the beans.

[Jantar]

HLG, Briscoes and others being discussed on Magic Talk this afternoon and many outraged listeners voicing their anger and suggesting boycotts at companies taking the wage subsidy while making decent profits and paying dividends. HLG is very guilty on this front and personally I think it is morally wrong.

When the lockdown first occurred no-one knew how long it would go on for. The purpose of the subsidy was to keep staff employed.

Would you have been happier in HLG did not take the subsidy and instead chose to lay off most retail staff, hoping to re-employ them after the lockdown ended?

[iceman]

When the lockdown first occurred no-one knew how long it would go on for. The purpose of the subsidy was to keep staff employed.

Would you have been happier in HLG did not take the subsidy and instead chose to lay off most retail staff, hoping to re-employ them after the lockdown ended?

I was very happy with Silver Fern Farms (one of my largest holdings) taking the subsidy but when things turned out better than expected, they paid it back in full before announcing dividends.

[couta1]

When the lockdown first occurred no-one knew how long it would go on for. The purpose of the subsidy was to keep staff employed.

Would you have been happier in HLG did not take the subsidy and instead chose to lay off most retail staff, hoping to re-employ them after the lockdown ended?

I think its more about paying it back once your books show that you weren't down the specified percentages as set out in the criteria, many companies did pay it back and at the end of the day its taxpayers money(Whoops didn't see your post iceman)