Trading update from ASX listed Universal Store, which has some interesting read through's for Glassons Australia. attached with the trading update a very brief investor presentation from last week.
Otherwise a solid update and roughly in line with consensus, Universal (& indeed most of AU retail) has gotten absolutely hammered and down 48% YTD 2022. Although to be fair, AU retail has always tended to trade at higher multiples than NZ, for various reasons, so I guess can fall a bit more when rates rise.
It's quite a good company - nice margins, coherent plan, good cashflows and net cash position.
Relevant to Glassons as majority of customers are women, and whilst they sell a range of branded products, the growth engine of the business are its private labels and specifically newly launched Perfect Strangers brand. Customer demographic similar ("on-trend apparel products to a target 16-35 year old fashion focused customer). Products similar but I'd put Glassons more in the fast fashion & discount section (competiting against supre, zara, revolve, forever21, boohoo) vs Mid-Range for Perfect Stranger & Universals other brands (competing against glue, shopo, unaway, meshri, edge etc).
anyway update has some of mgmt's perspectives on how the trading environment for the period to june has been reasonable all things considered which is a readthru for glassons.
The minimum wage increase of +5% (announced last week) is a bit of a worry and things are across the ditch seem to be catching up to NZ quick.
I dont have any shares in either glassons or Universal store but both on my watchlist when capitulation occurs.
Universal, with a june year end and substantially now complete, trading on a last 12 month PE of 12.2x, and next 12 month PE of 9.0x. Dividend yield not too bad either but we cant use the franking credits. Dont think the consensus for next year is a valid baseline but its an interesting one to watch from a HLG perspective, or on its own.
Hallenstein Glasson is delighted to announce the appointment of Rob Brown as Hallenstein Brothers CEO. Rob is an accomplished leader with over 20 years’ experience in a uniquely diverse fashion retail background spanning across strategic planning, brand management and customer service. Rob has been a Brand Manager at True Alliance since 2009, most recently with full accountability for the Ben Shermin brand. During this time Rob has had oversight across product sourcing, buying, design, marketing, wholesale and retail sales, brand positioning and organizational development. Rob’s mandate is the ongoing development of the strong and capable executive team, whilst continuing to build upon the strategic initiatives within the business. Rob’s appointment is effective 17th October 2022.
Clothing, footwear and personal accessory retailing rose 1.3% ($36.2m) in June, in seasonally adjusted terms.
And 27% higher than June last year …wow 27% up
Good for Glassons AU
whats your updated guesstimate for FY22 NPAT? Or even better, FY23?
Oddly enough for this moose I wound up dipping my hooves into Universal Store at A$3.50 following my post above (#8383), as thought on a risk adjusted basis was a good time to start DCA in. Now up ~35% but only bought around a third of the # of shares I ultimately wanted to acquire. Remain conservative/skeptical on the outlook for retail over the next 2yrs but thought that was a decent entry. The trick here for a long term investor is trying to recall the various covid closures at passed points in time...IE, 1H FY23 for most aussie retailers (or anyone exposed to covid closures) should show strong comps on FY22 given that was when some of the worst closures were. So market could rebound after posting some strong figures before the 2H reality sets in. Traders should enjoy that dynamic. Very difficult to remain patient/disciplined when markets rally. Often time what we think ought to happen, doesn't happen, for periods of time (or ever).
Originally Posted by winner69
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