HLG - Hallenstein Glasson

[Muse]

Hello hoping one of you can help me with a question. While browsing through the annual report of HLG I have found that on the balance sheet there is:

Current lease liability22,991
Non-current lease liability53,641

This all makes sense however on the cash flow statement there is a line:
interest on leases2,430

For a business that rents its stores why is there an interest on leases?

Cheers

you can thank IFRS16 for that one. bloody accountants (no offense, beagle)

[Beagle]

you can thank IFRS16 for that one. bloody accountants (no offense, beagle)

LOL Yeah, I know...some weird ones sit around in ivory towers with not enough to do and dream up new weird and wacky ways of doing things to try and justify their existence. IFRS 16 is my pet hate. I've printed it out, hung it on the wall and I often throw darts at it which is very therapeutic

Its disappointing to see HLG in the very low $6's. I guess the market hates uncertainty and that's exactly what omicron is serving up.

[Snoopy]

Hello hoping one of you can help me with a question. While browsing through the annual report of HLG I have found that on the balance sheet there is:

Current lease liability22,991
Non-current lease liability53,641

This all makes sense however on the cash flow statement there is a line:
interest on leases2,430

For a business that rents its stores why is there an interest on leases?

You missed the offsetting 'asset' piece that completes the puzzle 'buy high sell low', an accounting construct created by IFRS16 called 'Right of Use Assets'. Likewise 'lease liability' is a part of what used to be called 'rent' under previous accounting standards.

Right of Use Assets	67,223
Current lease liability	(22,991)
Non-current lease liability	(53,641)

You will notice that 'Right of Use Assets' do not balance the 'Lease Liability':

$67.223m-$22.991m-$53,641m = -$9.409m (over the complete time span of all lease contracts)

On a single current year basis, the 'Right of Use'/'Lease Liability' is balanced by an 'interest on leases' payment which for FY2021 was $2.430m. However under old accounting standards, and as far as day to day management of the HLG business goes, that $2.430m 'interest' (sic) payment would be thought of as part of the rent.

That is how I understand this IFRS mess.

SNOOPY

[Waltzing]

"low 6"

and westpac today releasing it "COVID BILL DUE"

sentiment is on the wain in certain sectors across the economy..

however AUS is all GO!!!

Travel will come back in the next 24 months, buy some travel.

A Horse muscle specialist from IRAN who speak in an IRISH manner went 3 times to germany last year..

Some peoples from other countries are just HARDEND to life.

They will travel no matter what.

And a clothes Horse... Shops till she drops...

[buy_high_sell_lo]

Very much appreciate this explanation SNOOPY brings about some clarity to the puzzle.

[Rawz]

Very much appreciate this explanation SNOOPY brings about some clarity to the puzzle.

Isnt Sharetrader great. So many 5 star generals always happy to help the next wave of investors coming through. Gosh we are lucky

[850man]

Isnt Sharetrader great. So many 5 star generals always happy to help the next wave of investors coming through. Gosh we are lucky

and us "next wave investors" need all the help we can get too. Very challenging times and difficult to hold one's nerve

[LaserEyeKiwi]

LOL Yeah, I know...some weird ones sit around in ivory towers with not enough to do and dream up new weird and wacky ways of doing things to try and justify their existence. IFRS 16 is my pet hate. I've printed it out, hung it on the wall and I often throw darts at it which is very therapeutic

Its disappointing to see HLG in the very low $6's. I guess the market hates uncertainty and that's exactly what omicron is serving up.

IFRS 16 is an extremely hostile thing done to NZ retail investors, turning something that was relatively simple to decipher into a pretzel shaped calculation that obscures the underlying financials.

[Beagle]

IFRS 16 is an extremely hostile thing done to NZ retail investors, turning something that was relatively simple to decipher into a pretzel shaped calculation that obscures the underlying financials.

Yeap, no doubt about it, IFRS 16 is a dog's breakfast. Please don't ask me to explain it in detail, I'd rather have root canal surgery on my teeth.

[Grimy]

$6.01. How far into the $5 range before it starts to get some support?
I'm certainly looking to top up, but maybe no need to hurry pressing the buy button.
Or grab a few now and then wait and see where it goes?