WHS - Warehouse Group

[macduffy]

Anyone out there own a retailer that is doing better? It looks like when I was bought out of the Warehouse at $5, my decision to reinvest those proceeds to boost my RBD holdings was a good one.

Briscoe's latest annual result produced a margin of 6.2% (NPAT $27.5m/Revenue $438m).

Unfortunately, I only hold a few from the IPO - never bought any more!

[CJ]

HLG has a 8% margin (NPAT9,028/ revenue $108,572) excluding its hedge gains - from the 6 month unaudited accounts. (8.9% from the 2011 full accounts)

Would you pay twice as much to buy HLG (8% margin) than you would to buy WHS (4% margin)? YOu would need to consider volatility of margins etc???

[Snoopy]

HLG has a 8% margin (NPAT9,028/ revenue $108,572) excluding its hedge gains - from the 6 month unaudited accounts. (8.9% from the 2011 full accounts)

Would you pay twice as much to buy HLG (8% margin) than you would to buy WHS (4% margin)? You would need to consider volatility of margins etc???

With HLG you are in the lead so far CJ. 8.9% is very impressive, particularly when HLG management were grizzling about high shopping mall rents over that time period as I recall.

However, I think your point on volatility of margins is valid.

Over a very short time frame, co-incident with a sale for instance, you may very well generate a fantastical margin figure. Over longer time-frames such blips should even out. That is why IMO using a six monthly figure is probably not a fair comparison.

My gut feeling (which may be wrong!) is that food retailing is likely to be less volatile that general retailing.
This is one reason why in tougher times I feel comfortable with my own retail investment sitting in food.


SNOOPY

[h2so4]

HLG has a 8% margin (NPAT9,028/ revenue $108,572) excluding its hedge gains - from the 6 month unaudited accounts. (8.9% from the 2011 full accounts)

Would you pay twice as much to buy HLG (8% margin) than you would to buy WHS (4% margin)? YOu would need to consider volatility of margins etc???

Using inventory turns to get some business economic insights, HLG gets their 8% every 67.6 days compared to WHS who get their 4% every 89 days and

RBD an incedible/credible 2.7days for 6%. RBD probably smokes any retailer on the NZX.

[winner69]

So the WHS margin is forecast to be somewhere near:

$64m/$1638m= 3.9%SNOOPY

Punters say the Red Sheds finding it hard to compete with Bunnings ..... last Annual Report for Bunnings in NZ to June 11 shows sales of $585m with NPAT of $2m ..... that razor thin margin of 0.3% puts WHS in good light eh

Maybe, just maybe, WHS ain't doing that bad

[percy]

[QUOTE=winner69;375242]Punters say the Red Sheds finding it hard to compete with Bunnings ..... last Annual Report for Bunnings in NZ to June 11 shows sales of $585m with NPAT of $2m ..... that razor thin margin of 0.3% puts WHS in good light eh

Am I allowed to ask the question;Why bother?

[arcticblue]

Does anyone have the margins for MHI already calculated? I would have thought their's were quite good. Not sure about their turnaround though.

[CJ]

Does anyone have the margins for MHI already calculated? I would have thought their's were quite good. Not sure about their turnaround though.

2012 Half year 9% (NPAT 26,297 / Rev 288,846)
2011 Full year 8% (NPAT 39,985 / Rev 489,330)

Both ignoring currency movements which are reported below the line.

[h2so4]

It's interesting that MHI has a very low turnaround, something like 312 days. Low turnover is something they have been consistent with and that's probably because they are a manufacturer as well as a retailer.

[percy]

Using inventory turns to get some business economic insights, HLG gets their 8% every 67.6 days compared to WHS who get their 4% every 89 days and

RBD an incedible/credible 2.7days for 6%. RBD probably smokes any retailer on the NZX.

Imagen the Chicken would be really Fowl after 3 days.