WHS - Warehouse Group

[winner69]

I would argue as times get tougher consumers will head down the road to make more value based buying decisions ......

Assume you are talking about the Red Sheds

I've heard that argument so many times over the years but it seems based on misconceptions and not backed up by the numbers

Red Sheds over the last 16 years have grown sales at 0.9% pa (best year before this year 4.7% as well as several negative years)

Those 16 years have seen the ups and downs of the economic cycle - and interesting post GFC 2008 through 2011 Red Sheds sales declined every year. Tough times they said and even though NZ retail sales remained pretty positive there wasn't many 'heading down the road to make more value based decisions' at the Red Sheds

But then Red Shed sales might be up about 5% this year (and v 2019) just to prove that this time things are truly different

[LaserEyeKiwi]

Assume you are talking about the Red Sheds

I've heard that argument so many times over the years but it seems based on misconceptions and not backed up by the numbers

Red Sheds over the last 16 years have grown sales at 0.9% pa (best year before this year 4.7% as well as several negative years)

Those 16 years have seen the ups and downs of the economic cycle - and interesting post GFC 2008 through 2011 Red Sheds sales declined every year. Tough times they said and even though NZ retail sales remained pretty positive there wasn't many 'heading down the road to make more value based decisions' at the Red Sheds

But then Red Shed sales might be up about 5% this year (and v 2019) just to prove that this time things are truly different

Don’t forget there has been a significant reduction in Red Shed floor space, so red shed sales per Square foot have risen fairly quickly over the last few years (a big push from management for higher “density” sales) This is because all the Warehouse Stationary store within a store sales in red sheds are not included in Red Shed revenue, and they take up a significant amount of floor space. So this has pushed up sales per square foot for red shed obviously given revenue / square footage has increased with the 25 new SWAS locations (another 20 yet to be added).

Effectively red sheds have been downsized significantly while still managing to grow revenue. (Part of the reason operating profits have increased so dramatically with the big reduction in operating costs for this endeavor)

[Beagle]

Latest Warehouse advertising in Te Reo extoling the virtues of the Warehouse being a merchant that cares about being both "sustainable and affordable" hits all the right ESG buttons so is bound to impress the target market.

[BlackPeter]

Latest Warehouse advertising in Te Reo extoling the virtues of the Warehouse being a merchant that cares about being both "sustainable and affordable" hits all the right ESG buttons so is bound to impress the target market.

That's a worry - hope they don't follow on the tracks of another well discussed "pink" company, shall we?

I know, different industry, but they started as well with Te Reo, being sustainable and a funny colour scheme.

But the good thing is, the WHS doesn't process milk ... yet ;

[winner69]

I’ve always respected the work of Aswath Damodaran whose a finance professor and investor

He recently wrote a good piece on ESG. Is well worth a read.

The ESG Movement: The "Goodness" Gravy Train Rolls On!

Last year, I wrote a post on ESG and explained why I was skeptical about the claims made by advocates about the benefits it would bring to companies, investors and society. In the year since, I have heard from many on the topic, and while there are some who agreed with me on the internal inconsistencies in its arguments, there were quite a few who disagreed with me. In keeping with my belief that you learn more by engaging with those who disagree with you, than those who do, I have tried my best to see things through the eyes of ESG true believers, and I must confess that the more I look at ESG, the more convinced I become that "there is no there there". More than ever, I believe that ESG is not just a mistake that will cost companies and investors money, while making the world worse off, but that it create more harm than good for society.

http://aswathdamodaran.blogspot.com/...avy-train.html

[LaserEyeKiwi]

I’ve always respected the work of Aswath Damodaran whose a finance professor and investor

He recently wrote a good piece on ESG. Is well worth a read.

The ESG Movement: The "Goodness" Gravy Train Rolls On!

Last year, I wrote a post on ESG and explained why I was skeptical about the claims made by advocates about the benefits it would bring to companies, investors and society. In the year since, I have heard from many on the topic, and while there are some who agreed with me on the internal inconsistencies in its arguments, there were quite a few who disagreed with me. In keeping with my belief that you learn more by engaging with those who disagree with you, than those who do, I have tried my best to see things through the eyes of ESG true believers, and I must confess that the more I look at ESG, the more convinced I become that "there is no there there". More than ever, I believe that ESG is not just a mistake that will cost companies and investors money, while making the world worse off, but that it create more harm than good for society.

http://aswathdamodaran.blogspot.com/...avy-train.html

I read that piece earlier this week. In general it reinforces my view that for consumer facing companies (like WHS certainly is) - ESG is a “hygiene” issue - eg it’s a minimum requirement that won’t bring extra rewards to the company, but not having a strong ESG effort will have a detrimental impact on revenue as some consumers won’t shop with you out of principle.

[winner69]

I read that piece earlier this week. In general it reinforces my view that for consumer facing companies (like WHS certainly is) - ESG is a “hygiene” issue - eg it’s a minimum requirement that won’t bring extra rewards to the company, but not having a strong ESG effort will have a detrimental impact on revenue as some consumers won’t shop with you out of principle.

Maybe so but majority of consumers see through ESG 'efforts' for what they are ...and often have an 'adverse' impact

Some interesting insights in this US study

The Corporate Social Mind
https://www.thecorporatesocialmind.com/researchusa

[winner69]

This bit from Aswath is good -

On a personal note, I have always found that the people that I've known who do good, spend very little time talking about being good or lecturing other people on goodness. I would extend that perspective to companies and investment funds as well, and I reserve my skepticism for those companies that spend hundreds of pages of their annual filings telling me how much "good" they do.

Hey BlackPeter - Synlait come to light eh ....and HLG had pages and pages about People, Planet etc etc

Warehouse going that way --- enough said

[Beagle]

Maybe ESG is an acronym for Environmental & Social Grandstanding

[LoungeLizzard]

No amount of greenwashing could ever make WHS an ethical investment. To invest or not invest is down to the individual, but don't kid yourself about the nature of the business.