WHS - Warehouse Group

[LaserEyeKiwi]

@ Getty: individual experiences vary. I am biased. When I shop at Costco I see products that everyone buys, items that fit into every home and name brands that people want. Walk into the Warehouse and see what selection of TVs and electronics they have? Where are the name brands? I know this from 1st hand information of my cousin working at corporate office of the Warehouse some 20 years ago. The complaint at the time was name brand distributions have stakeholders - meaning they could not get those brand names because of other retail competitors selling their line. Further back, the approach of "parallel importing" provided more options for buyers but... like Sony says, not all lines are made the same. A Sony CD player made in Thailand or Vietnam did not have the same quality as the Sony made in Japan. After several years this approached died because junk quality is just that, being left with an inventory of junk stock. But they didn't have to wait too long, eventually most of the name brands closed their door on The Warehouse. I suppose that's why the TWG did it through 'acquisitions' by buying out Noel Leeming / Bond & Bond. Interesting I say because these models vary from how Costco and Walmart operate.

@ winner69 & bull....

Weak excuses. Let's be real here. Unloading a significant stock position in a company is NEVER favorable. Especially coming from a company that operates in similar market places and on the same competing field.

You can be sure Jim Cramer will never make such statements that "oh they're selling off stock because of 'favourable market conditions" lol my god. I suppose all you guys can stand around with your hands out for the dividend policy that the TWG has.

Got to love all those Kiwi Saver funds buying up the slack, perhaps that would be the biggest sin ever.

eh - the name brand TVs are all for sale at Noel Leeming of course. Thats how successful market segmentation works - the warehouse is absolutely not for selling high end TVs. People shopping for TVs at the warehouse are after the cheap models. People who want the name brand TVs with superior features go to Noel Leeming (likewise how the warehouse shouldn’t be selling premium brand TVs, it would be terrible for Noel Leeming to be selling the cheap TVs stocked at the warehouse.)

Also you are vastly overplaying how “disastrous” it is for foodstuffs to be selling there stake. Foodstuffs are not an institutional investor - they don’t invest in other companies. The warehouse investment long ago was a one off event that was done to protect its own interests and has been a weird overhang ever since. Now that overhang is thankfully gone, and what’s more it makes NZSX50 inclusion much more likely as a nice unintended result.

[Habits]

Not so.
I have a 32 yr old TV I bought cheap at the warehouse, still going, & others I bought elsewhere for 3 times the price lasted less than 12 yrs.
I have an electric Jug bought probably 15 yrs ago for $11.
It boils in half the time, and makes a third of the noise of the expensive ones in flash places I stay or visit.

He stays in flash places but shops cheapand gets more than monies worth lol... no offence Getty. I walk around in my cheap clothes and eat out at ethnic eateries where I get a fair deal... and shop at warehouse

[SBQ]

People haven’t stopped shopping at the warehouse though, sales haven’t fallen at the red sheds over last 5 years - in fact been pretty consistently around $1.7 Billion annually, give or take a few percent (despite increased competition)

Meanwhile in that same time period Warehouse group has grown Noel Leeming sales from $750 million to somewhere approaching $1.15-1.2 Billion this year.

In fact this year non-red shed revenue (Noel Leeming, Torpedo7 & Stationary) will be in striking distance of accounting for 50% of The Warehouse Groups total revenue. It’s conceivable that in 2022 or 2023 that the red sheds become a minority of WHS revenue, which is something I don’t think many would have expected (could even happen this year if an acquisition happens).

My apologies for not understanding those figures. You could of quoted those sales figures in x 10 times but that does not compute. However, I do understand metrics like 'earnings per share' and P/E ratio but EBITDA leaves a bad taste in my mouth.
Many moons ago I saw The Warehouse time after time, float more and more shares (we call it share dilution) while trying to keep shareholders happy with their dividend paying policy. I have an aunt that has owned TWG shares way back over 20 years ago. If I recall around $8/share. Stock split 2:1 adjusted... still a loss in her books. Man waiting 20 years to get flat line results?

[alokdhir]

As expected WHS star of the downside today $ 3.40 ....Big question is it a buy here or not ?? experts please

[winner69]

As expected WHS star of the downside today $ 3.40 ....Big question is it a buy here or not ?? experts please

BUY BUY BUY is the answer

Lot more upside to come

[alokdhir]

foodstuffs are selling there shares because for the first time in years there is actually substantial demand for warehouse shares that they can off-load there holding.

Mainly retail buying it or getting into the trap ...are institutions smarter here ?? Maybe its the flavour of the season ...does not have long runways of Growth for institutions interest

[alokdhir]

BUY BUY BUY is the answer

Lot more upside to come

Thanks for your prompt thumbs up buddy ...I assume u already in to your max ?? All retail experts are positive ...so must be something here ...BBB has also given thumbs up .

[Beagle]

Thanks for your prompt thumbs up buddy ...I assume u already in to your max ?? All retail experts are positive ...so must be something here ...BBB has also given thumbs up .

BUY I would buy more but already have truckloads.

[winner69]

Retail sales on a roll ...beat guru’s expectations

Westpac man says -

Satish Ranchhod
May 24, 2021

Retail spending rose by 2.7% in the March quarter. That followed a similar sized fall in December. Today’s result was stronger than our forecast for a 0.7% increase, and well above the median analyst forecast for a 1.8% decline in spending. This indicates upside risk for March quarter GDP growth.

Q1 real retail sales (volumes): +2.5% (Prev: -2.6%)

Westpac f/c: +0.7%, Market f/c: -1.8%

Q1 real core sales (volumes): +3.2% (Prev: -2.9%)

Annual change – total real retail spending (volumes): +6.8% (Prev: +4.6%)



Detail

Retail spending rose by 2.7% in the March quarter. That followed a similar sized fall in December.
The rise in spending in the March quarter was widespread, but mainly related to increased spending on household durables, like recreational equipment and electronics. Spending on these sorts of durable items can be lumpy on a quarter-to-quarter basis, and these are the same categories that contributed to last quarter’s decline.
Despite firm demand and ongoing reports of supply shortages, overall retail prices remained flat over the quarter. Prices in core retail categories (which excludes fuel and motor vehicles) fell by 0.7% over the quarter. That followed larger than usual increases during the Christmas shopping period last year.
Today’s result was stronger than our top-of-market forecast for a 0.7% increase, and well above the median analyst forecast for a 1.8% decline in spending.
We’re forecasting a flat outturn for March quarter GDP. That in part reflects the continued drag from the loss of international tourists. Today’s result suggests some upside to that estimate. However, we’ll firm up our forecasts as other partial indicators are released over the next couple of weeks.


Outlook

Retail spending has been resilient since the economy exited lockdown. Spending appetites have been buoyed by the low level of interest rates, strength in the housing market and diversion of spending previously earmarked for overseas holidays back into the local economy. Those factors have helped to offset the drag from the loss of international tourist dollars.

We expect spending will continue to firm over the coming months. However, compared to pre-Covid trends, spending growth is likely to be constrained by the continued lack of international tourists and the slowdown in population growth.

[SBQ]

eh - the name brand TVs are all for sale at Noel Leeming of course. Thats how successful market segmentation works - the warehouse is absolutely not for selling high end TVs. People shopping for TVs at the warehouse are after the cheap models. People who want the name brand TVs with superior features go to Noel Leeming (likewise how the warehouse shouldn’t be selling premium brand TVs, it would be terrible for Noel Leeming to be selling the cheap TVs stocked at the warehouse.)

Also you are vastly overplaying how “disastrous” it is for foodstuffs to be selling there stake. Foodstuffs are not an institutional investor - they don’t invest in other companies. The warehouse investment long ago was a one off event that was done to protect its own interests and has been a weird overhang ever since. Now that overhang is thankfully gone, and what’s more it makes NZSX50 inclusion much more likely as a nice unintended result.

Man... as bad as Kiwi Saver funds that just buy the S&P500 index ETF and pass on the absurd high management fees to NZ investors. There's no skill in doing that. Think about it ; can't get the brand but you see other retailers having it? Can't integrate it into the current business model? Ok the shareholders will weather the storm by making acquisitions. (if you can't beat them... buy them)

Again.. where's the skill? You know these retail outlets take up a lot of real estate. When I walk in and there's like more staff workers than customers, God I can't image the cost associated in keeping these buildings going. Better find ways of saving like turning the lights off.

Is Noel Leeming doing well? How so compared to Harvey Norman?