MHJ - Michael Hill International.

[KJ]

Flat last quarter sales-announcement 8 April-now catching up with the rest of the market.

[k1w1]

quote:Originally posted by rmbbrave

MHI has fallen from over $8 to nearly $7 in a week!

Does anyone know if there is a special reason for this?

MHI:Blue Sky & Sausages For Sale Thread gaining wider circulation outside the STrader community.

[skinny]

Alas I can't comment on NZ shares any longer, but k1w1

[Anna Naum]

Fisher Funds own this stock

[rmbbrave]

Profit up 9.6%, Dividend up 9.5%, SP down 6.5%. The same thing happened 6 months ago - only the drop was greater. The SP shot back up a few days later.



19 Aug 2005 04:18
FLLYR: MHI: FY to 30/06/06 $16,510M ($15,060M) +9.6% DIV 14cps

Michael Hill International Limited
For Full Year Ended 30/06/05
This Report has been prepared in a manner which complies with generally
accepted accounting practice and gives a true and fair view of the matters to
which the report relates and is based on audited accounts.

CONSOLIDATED OPERATING STATEMENT
Current Full Year NZ$16,510,000; Up 9.6%:Previous Corresponding Full Year
NZ$15,060,000

Total Operating Revenue : $273,157,000

OPERATING SURPLUS BEFORE UNUSUAL ITEMS AND TAX: $24,351,000

Unusual items for separate disclosure : Nil

OPERATING SURPLUS BEFORE TAX : $24,351,000

Less tax on operating profit : $7,841,000

OPERATING SURPLUS AFTER TAX BUT BEFORE MINORITY INTERESTS :$16,510,000

Less minority interests: Nil

Equity earnings: Nil

OPERATING SURPLUS AFTER TAX ATTRIBUTABLE TO MEMBERS OF LISTED ISSUER:
$16,510,000

Extraordinary items after tax attributable to Members of the Listed Issuer:
nil

OPERATING SURPLUS AND EXTRAORDINARY ITEMS AFTER TAX ATTRIBUTABLE TO MEMBERS
OF THE LISTED ISSUER: $16,510,000
Earnings per share : 42.8 cps

Final Dividend : 14 cps

Date Payable: 17/10/05

Imputation tax credit on latest dividend 6.895518 cents

Summary Of Commentary:

Chairman''s Statement
1. Profit Announcement
Michael Hill International has today announced a record tax paid profit of
$16,510,000 for the 12 months ended 30 June 2005, 9.6% up on the previous
year.
Group sales increased by 4.5 % to $271,573,000 (2004 - $259,777,000).

The results for the year represent an excellent 26.8 % return on average
shareholder''s funds (2004 - 28%), a return on average total assets of 13%
(2004 - 13%) and the Board is pleased with the overall result.

Segment Results
As stated in the half year results, the company has redefined its
geographical reporting segments to better reflect the financial performance
of each segment. The segments now reported on reflect the performance of the
company''s retail operations in each segment and exclude non-core retail
activities such as manufacturing, wholesale and distribution, and other
general corporate expenses. The Directors believe this change will better
inform the readers of the financial performance of our geographic segments.

New Zealand Operations
The New Zealand Company performed well with one new store being opened at
Glenfield in Auckland during the year. Revenue increased by 0.2% to
$86,459,000, with operating profit down 0.2% from $9,879,000 to $9,854,000.
Operating profit as a percentage of revenue was steady at 11.4%. Sales
during the second half of the year were down on expectations as the economic
conditions tightened in New Zealand.

Same store sales decreased by 1 % for the 12 months (last year 1.2%
increase).
Total stores operating in New Zealand at 30 June 2005 were 47.

Australian Operations
The Australian Company had a solid year and improved its revenue by 5.4% for
the 12-month period (in NZ dollars) with operating profit up 7.6% from
NZ$16,530,000 to NZ$17,792,000.
In Australian dollars, total sales were up 10.2% to A$161,806,000 and
operating profit up 12.5% to A$16,368,000.
Same store sales improved by 1.6% for the 12 months in Australian dollars.
As with New Zealand, sales during the second half were down on expectations
as economic conditions tightened.
The exchange rate used for the translation of the Australian surplus was .92
(2004 - .88).

During the course of the year, a further ten stores were opened at the
following locations:
Bunbury Forum in West Australia
Casula Mall in Sydney
Bay Village in New South Wales
Maryborough in Queensland
Batemans Bay in New South Wales
Grand Central Toowoomba in Queensland
Parkmore in Melbourne
Raymond Terrace in New South Wales
Mirrabooka Square in Perth
The Pines in Melbo

[Halebop]

A strong result in the current environment, albeit I thought they would manage EPS of 44 cents. From the share price reaction I suspect the market agrees although for MHI it tends to voice it's opinion on ever low volumes.

New Zealand is showing its mature development. Still seems to be puff left in Australia albeit rolling out 10 stores doesn't have the same impact it used to with 102 now open.

Canada looks very positive. In 5 years time it will be bigger than the New Zealand operation. Look for a 4th Country opening in 2 to 3 years once Canada is earning.

Fundamentally for me the share price has come back to within 50% of some of my higher DCF values, assuming they can continue to manage something like historic 14% growth rates. Weak technicals continue to keep me out.

[Gryffyn]

Where's the chart?

[rmbbrave]

In the last 6 months MHI has been trading between 7.4 and 7.6.

But the SP has gone on a steep dive below this twice and then shot back up into it's usual range again just as quick.

I have bought on both of these dips and sold soon after, for a small profit.

The SP looks like it might be at the start of another dip.

Is this a recognised TA pattern? If so does it indicate anything?

[limegreen]

I don't think it's a 'pattern' per se, but there is something 'interesting' going on. Overall, MHI is trading in a very narrow range. I'm not precisely sure of the mechanics, but looking at the announcements and SSHs there is clearly a buyer in the market, but who appears to be (at this stage) mostly mopping up small sellers. I'm not sure why the price keeps dropping. Perhaps Mr Peters and his associates stop buying, wait for nerves to set in, and when the price really starts falling and there is a row of willing sellers, they swoop[?]. Certainly, the stays static on very thin volume, falls on thin volume, and then rises on large volume. Thus, if the price does drop again, it seems possible that there may be another big buy order. If the buy order doesn't come through, then the price may not rebound. Will you call his bluff?

[Phaedrus]

MHI is back to where it was a year ago. The current "trading range" is too narrow to trade effectively. Rmbbrave, you are either very skillful or very lucky! I would suggest, though, that if you want to trade short-term like this, there are other stocks more suitable than MHI.

The key to what is going on here lies with Limegreen's observation that the price "falls on thin volume, and then rises on large volume". This is quantified and easily seen in the rising On Balance Volume plot he has included.
This stock is being accumulated by people with more patience than I have!