VIL - Veritas Investments Limited

[percy]

Location of any retail business including a butcher's shop is most important.
Top location usually means paying top rental.Shopping Malls are most probably the top retail location.
So are all tenants in the mall equal? NO.The major attractions like supermarket,The Warehouse,The Farmers pay a lot less rent per sq metre than the speciality stores such as Paper Plus,Chemist shop and Postie Plus.We therefore see the likes of Harvey Norman,The Mad Butcher going to destination type stores.What they save on rent they can use to attract customers.
So when a speciality store sells the same as the supermarket they have an even higher hill to climb ,as most of their customers are already going to the supermarket,and can put off making a special trip to that destination store.
Remember I have only been to The Mad Butcher once to buy a leg of lamb they had on special.I buy our steak from the butcher's shop at Barrington Mall ,yet buy all our everyday meat/chicken supplies from a supermarket.

[winner69]

But can u get one of these specials at countdown?

Reckon verItas shareholders make more on these deals than the butcher ....and that is the way it should be eh


FRESH NEW ZEALAND BONELESS BUTTERFLIED LAMB LEG
$16.99
per Kilo
WHILE STOCKS LAST
Valid from 20 January to

[noodles]

Location of any retail business including a butcher's shop is most important.
Top location usually means paying top rental.Shopping Malls are most probably the top retail location.
So are all tenants in the mall equal? NO.The major attractions like supermarket,The Warehouse,The Farmers pay a lot less rent per sq metre than the speciality stores such as Paper Plus,Chemist shop and Postie Plus.We therefore see the likes of Harvey Norman,The Mad Butcher going to destination type stores.What they save on rent they can use to attract customers.
So when a speciality store sells the same as the supermarket they have an even higher hill to climb ,as most of their customers are already going to the supermarket,and can put off making a special trip to that destination store.
Remember I have only been to The Mad Butcher once to buy a leg of lamb they had on special.I buy our steak from the butcher's shop at Barrington Mall ,yet buy all our everyday meat/chicken supplies from a supermarket.

This seems like a reasonable theory and may be a reason to bypass an investment opportunity for a startup business. However, we are dealing with a proven business. Percy, you may not be bothered to walk another 200m to the Mad Butcher, but it is clear that some are. Maybe for someone on a budget?

[percy]

This seems like a reasonable theory and may be a reason to bypass an investment opportunity for a startup business. However, we are dealing with a proven business. Percy, you may not be bothered to walk another 200m to the Mad Butcher, but it is clear that some are. Maybe for someone on a budget?

I think the reason I am not a Mad Butcher shopper is because there is not one handy to me.
As for investing in the company, I have not wanted to buy into the retail sector.I have held that view for over two years now [maybe longer].
I do not hold a retail stock.

[noodles]

I have not wanted to buy into the retail sector.I have held that view for over two years now [maybe longer].
I do not hold a retail stock.

And I think very wise approach in general. But ordering meat on-line is not yet cheaper and more convenient than at a butcher.

[noodles]

One thing I did miss out in my analysis was dividends.

Here is the dividend policy...
"Veritas’ dividend policy is to distribute between 60% and 70% of the Group’s net profit after tax.
"

So for FY15 eps of 13.8*, we could expect dps of 8.97c (assuming 65% payout ratio)

At a share price of 1.30, that gives a grossed up dividend yield of 9.6% (assuming 28% tax rate)

* eps calculation came from http://www.sharetrader.co.nz/showthr...l=1#post457304

[Harvey Specter]

You should only gross up 28/72 which is the max amount of imputation.

[noodles]

You should only gross up 28/72 which is the max amount of imputation.

Thanks Harvey, Fixed the original post

[winner69]

Noods - the $6.4m you show as NPAT for F14 is actually before tax. Whether this effects your eps calculation I don't know

You also don't take tax off the extra ebitda for the new stores in the future. Might make a small difference

But whatever a BU BUY BUY and only a sell when stores start going broke or they can't open as many new stores as they plan.

See they ave a company owned store waiting for an owner ....hopefully that will give them insights
,

[noodles]

Noods - the $6.4m you show as NPAT for F14 is actually before tax. Whether this effects your eps calculation I don't know

You also don't take tax off the extra ebitda for the new stores in the future. Might make a small difference

,

Thanks Winner, I've updated the column to be EBITDA. It does not affect eps as I had already taken off tax and depn for the calculation of eps. It does not affect new stores either. NPAT for FY14 is forecast as $4.2 mill.

Apologies all.