Nice symetry on 5 and 10 year chart
Must mean something?
Hoop - can you help
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Nice symetry on 5 and 10 year chart
Must mean something?
Hoop - can you help
Those plans include seeking alliances with European / North American retailers.
There was a good article in The Australian about the years result (not that brilliant) and I liked this bit -
That’s the spirit of adventure for you: blazing new trails and scaling new peaks. The trouble is, Kathmandu’s sales (and share price) tend to stumble at high altitude and Briscoe won’t be a benevolent Sherpa if it comes to the rescue.
Shareholders rejected equivalent of $1.80 kindly offered last year - guided by some pie in the sky valuations $2.10 to $2.41 (add say 10% to get current valuation)
Current KMD share price just over $2.00 seems OK
But BGR shares much higher now - that $1.80 would be $2.40 now (all other things being the same)
So Xavier still has a lot of work to do to justify KMD Board telling you to reject Rod
Last time I looked analysts had KMD at about NZ$2.10. Will be interesting to see what they have it at in the next week or so.
I think Xavier's done pretty good. What will be important now is whether he and Ben Ryan, who both have decent oversea's experience, can finally turn KMD into a truly international company. To be fair, Rod Duke has no experience at that - he is a big fish in a very small pond and his first attempt to go ex-NZ failed.
I agree with the line of thought that Duke won't stay for long as a SSH. He can't afford to buy them outright now, he's already got $1.2M in divvie coming and he'll probably downsell after Nov 14th, provided KMD stays above $2 (which I think it will).
So KMD had a good year and improved profits by $13m to $33m....but still have some way to go to get back to $40m which must be a number in some analysts working
I had a look at where the $13m came from (ir changes in key items from F15 to F16) which is shown
below
Reasonable revenue growth and a bit of margin expansion was good and lead to $14.4m increased margin.
Rents were up $5.3m (probably a necessity to survive) and they reduced other costs by $8.5m
So a fair chunk of the improved NPAT came from cutting expenses (forced) - as they say 'they saved their way to prosperity', not always a sustainable strategy
Looking forward and $40m profit one would have to think that they have squeezed what they can out expenses and to some degree margins - so the future looks like it depends on top line sales growth without stuffing other things up.
Will be interesting to see what happens
Market not impressed so far with the result
One other thing that fell out of the numbers I was playing around with was that in spite of the good vibes etc NZ sales in H2 were about the same as the year before
It was Australia that saved the day for KMD this year
Not often do we appreciate Aussies saving our bacon
Pity NZers were reluctant to buy more this year
Interesting q&a with Maurizio Viani
From Investsmart:
https://www.investsmart.com.au/inves...weekend-230916
http://theregister.co.nz/features/ex...an-do-about-it
Interesting article highlighting a trend for consumers to favour experiences over stuff..
I guess this is an opportunity for Kathmandu etc al
Transcript of investor call
https://www.nzx.com/files/attachments/244400.pdf
Reading between the lines I get impression that analysts didn't get the answers they were after - or positive vibes to the issues they were probing
Read like profit growth (if any) is not coming from global stuff or outlet expansion in ANZ but from still fixing things up ......hmm
Macpac growth outstripping Kathmandu. http://www.nzherald.co.nz/business/n...3&objectid=117
I must say I do like Kathmandu travel clothes and accessories - good stuff.
And Kathmandu would be drooling over these numbers that WHS put up re Torpedo7 -
Sales of $149m was +13% on FY15 performance and was underpinned by strong sales growth in both Torpedo7 and 1-day.co.nz.
Torpedo7 Stores delivered significant growth of +25% on FY15. The growing success of the Torpedo7 House Brand range a major contributor to this result
One of the issues probed by analysts was KMD's stock levels
Their stock management is still pretty abysmal
Stock turns a pretty low 1.5 times a year isn't very efficient. Jeez even pumpkin patch do a lot better than that, even with their sales declining at a fast rate.
Xavier really needs to get his 'product newness' and 'Just Enough' working better - else analysts won't be too impressed (ie no upgrades)
Just out a few paragraphs of Xavier's comments through the old buzzsaw
He does very well on that front - one of the highest use of buzzwords i have come across
Some research has concluded that high use of buzzwords by a company the greater the chance of underperformance
Put the same paragrahs through a readibility checker - interesting result (for a public announcement):
Your score is 18.4
That's really hard going. Your grade is about 12, which is at the same reading level as the Harvard Law Review. Chances are, you could do a few things to simplify it.
Fair enough although do you know what stock is taking longer to shift? A lot of KMD's inventory is "equipment" would you expect $500 tents etc to have the same turn around as the more fashion based retailers you compare with?
Granted it's an issue for them though..
Good read
https://www.nzx.com/files/attachments/245855.pdf
Support eliminating conventional cotton from their products.
Cotton hopelessly environmentally wasteful
AGM about to start at 11am. Expecting a trading update too, as they have provided one around AGM time the past 3 years.
Not very inspiring announcement
https://www.nzx.com/companies/KMD/announcements/292921
Almost verges on a profit downgrade in disguise
Yes and no - while sales are slightly down (due to FX which is uncontrollable, sales are up excl. fx changes) operational expenditure should also be down (promotional activity, less stores in UK). Key question is impact of FX on COGS. Still plenty of value at current prices IMO, especially if 1h profit is maintained. FX is key concern in the short term, shouldn't sway long term value.
Share price support has evaporated since going ex dividend but with so much resting on the Xmas& winter sales the performance is not too surprising. Kinda disappointed they're still just repeating past statements regarding the international opportunity.. I mean these are literally the same bullet points from old presentations.. would be interesting to hear from anyone present? Would actually be handy if KMD posted a video link on their website.
The Target Co Statement re briscoes takeover had revenue forecasts out to FY16. They didn't achieve the sales growth laid out in that forecast
If they had made a guess for FY17 i'm sure the 'promise' would have been for continued grow - hey don't take Briscoes up on their offer.
No sales growth for the first 15 weeks of the year is a bit of a worry in my view.
And the H1 profit forecast not that good either
4traders has 4.5% revenue growth in F17 - year not off to good start in light of this
Hope seems the story again
Kathmandu has been a frequent ram raid target this year.
Kathmandu products in very high demand.... for the ram raiders.
http://www.stuff.co.nz/national/crim...tore-ramraided
http://www.nzherald.co.nz/bay-of-ple...ectid=11631977
http://www.stuff.co.nz/national/crim...-east-Auckland
http://www.stuff.co.nz/waikato-times...id-in-pukekohe
Decided to exit this afternoon. Recived a couple of dividends and capital gain since buying in the low $1.50's
Good luck to all holders
Not exactly setting world on fire
https://www.nzx.com/files/attachments/252483.pdf
Looks like implied promises made in defence of Briscoes offer were a bit far fetched
So so H1 fir KMD - but that's better than the usual disaster our ones anyway
https://www.nzx.com/files/attachments/255141.pdf
The believerscwillthink pretty solid result
Rod (and others) will be thinking heck they not delivering on that bull**** they told everybody a year or so ago.
Rod did say he was watching closely
That Xavier pretty good with nice presentations - a bit like Nick from WHS
Kathmandidnt and kathmandont
http://www.nzherald.co.nz/business/n...ectid=11822184
Media seems to like it
Looks like they struggled with a high USD. Sales over all pretty flat and they've stalled on their 180 store target. Might be a mature business in Australia these days. I notice the international initiatives don't commence till fy18.
Maybe Rod is more interested in Ezibuy?
This retail expert thinks Kathmandu disappointing NZ
http://www.stuff.co.nz/business/9068...t-where-was-nz
Kathmandu need to do a better job of proof reading their financial statements
What do you think Winner, plenty of rain going about, consumers loading up on Rain Jackets early this year?
I don't know about that but the rain has prompted me to resurrect an old "London Fog" jacket that I bought in Vancouver about 20 years ago and subsequently "retired" as being unfashionable. Suddenly, it's back in fashion! Or maybe, that's not important at my age!
"Another concern for locals and experienced trampers alike was the number of unprepared tourists hitting the track, which can quickly become dangerous in unpredictable weather conditions.
The Herald witnessed trampers on the crossing in sandshoes and skinny jeans with scarves wrapped around their heads because they'd forgotten a hat and sunglasses.
Other more extreme examples of unprepared tourists included a group who had to be rescued from the track after walking it barefoot, channelling Frodo's barefoot journey through Mordor in The Lord of The Rings, or those tackling the crossing in jandals and wearing rubbish bags as ponchos."
This from the Herald on the hordes of tourists descending on the Tongariro Crossing.
Sounds like Kathmandu and/or Macpac should open up a shop at the start of the track! A 1000 hikers a day! Think of all the boots, hats and jackets they could sell!
Hey Huxley - see the HLG thread for comments
Have KMD given any profit guidance for F17? did say sales going OK in May, that's all I can see
Spose an update early August
At least weather going or them this year ...should help
They're the GNE of retail!
When the spot price is high everyone wants to buy their products..
While I like the company, I no longer hold.. I only had 8.5k shares in KMD and sold out a few of month ago and transferred the funds to IFT when they were "cheap" at the beginning of the year.
Primary reason was a wish to get out of retail stocks but I still think they'll do well. Sorry I haven't kept up regarding the guidance, but you know.. it'll all come down to a successful winter sale.. as usual.
Good luck to any holders ;)
Seems to have climbed steadily since you got out of it Huxley..... what shares are you thinking of selling off next? Might have to get some :P
Anyone know why they are climbing right now?
Ta
mum & dad investor
They have steadily improved the business since their big under-performance a few years ago, so why shouldn't their share price be increasing. If anything I'm surprised the shares haven't been trending upwards earlier since they have being showing they are making most parts of the business quite efficient.
Do you think briscoes will make another offer? or just ride the wave with their decent sized holding?
Huxley - IFT seem like a good share these days, but with domestic airlines dropping the amount of flights to WLG, and AKL getting another runway it could be in for some challenges with WLG airport. Still, plenty of cash in hand to make some good investments. I meant to pop into their investor meeting here a few weeks back but neglected to write down the time and missed it. I had their shares for several years and sold them approx two years ago.
I'd say Briscoes will probably just ride the wave, they tried to make a low ball offer earlier on when there was a chance shareholders may have accepted the offer, though now that KMD are in a much better condition it'd be even harder to put in a offer that would not insult current shareholders. Rod Duke is a prudent man and would only do something if there was a large margin of safety, trying to acquire KMD would require a premium and negate any margin of safety they could be acquired at. They have already made a considerable profit with their current holding, though they are probably more likely to sell once KMD are fully valued in the market than put in a offer for a full takeover at this moment.
https://www.nzx.com/companies/KMD/announcements/304968.
Great result, tracking towards the ~$60m EBIT range again - last time this range was reached the share price hit the high $3 range, pushing $4 at times.
Earnings growth for the foreseeable future driven by sales growth and a favorable USD/NZD rate making those COGS cheaper. Did I mention the great dividend yield...?
Keep it up Xavier :t_up:
Mountain Designs finding Kathmandu too good for them in Australia ....just maybe
https://www.smartcompany.com.au/indu...d-competition/
WOW — first half profits up by more than 20% on last year
http://nzx-prod-s7fsd7f98s.s3-websit...373/273437.pdf
Bit of a worry that NZ same store sales down 6.4% though — but profit from higher margins is what matters
They say profit will be ‘not less than $12m’
I reckon ‘will be more than $12m’ sounds a lot better
But then they already know it’s $12.1m and ‘will be about $12m’ isn’t that positive eh
Rod still interested
Would have been better off accepting his ofer last time ....but no doubt Kathmandu shareholders have even more elevated elevated (unrealistic) this time around ....might turn Rod off though
https://www.stuff.co.nz/business/102...-buy-kathmandu
Good on Kathmandu forking out $100m odd on buying an US shoe company ...OBOZ
Chance for you guys to get some more cheap shares in the SPP
https://quoteapi.com/resources/da986...WvtmcMRPXOko0Y
Russell Goward's Westmex was even more fun.! About a 100 shoe shops [or more] in the UK.
ChCh was the home to about four or five shoe manufacturers in the early 1960s including Duckworth Turner and M O'Brien.
In fact M O'Brien was about my first mistake on the sharemarket in 1967/68.!
"Gilmore" used to write excellent business articles in "The Bulletin",and ran a spec portfolio for readers.Often he wrote about his misfortunes of running a shoe business.
Lately Hellaby Holdings ran a very successful investment company,except for their exposure to shoes, through Hannahs and No.1 shoes.
As for a clothing retailer going into manufacture of footwear,I see it will end badly for shareholders.
Also 45% of OBOZ sales are to one customer ...with no contract in place either.
We critiqued this takeover well percy haven't we
Surprised the many Kathmandu shareholders on this site haven't come out and told us how good it is
percy ....these boots your scene?
Oboz get 4+ stars for customer satisfaction on Amazon (US$173 for the pair above)
interesting to see the concerns over the OBOZ acquisition, with not a lot of positive enthusiasm for it. I'll rise to the bait and outline a more bullish case ...
first, good result from KMD core business. the improvement in inventory, margins, and the recent sales growth since the period-end all very impressive (big sales periods yet to come of course). so well done KMD.
re: OBOZ. Yes, I agree, it's a stretch and outside their core competency as a NZ/Aust centric, apparel active-wear retailer. So a few red flags. BUT there is a bullish scenario. First, they know OBOZ well. They've been retailing their stuff for 10 yrs and were OBOZ's second customer, IIUC. They're not looking to integrate OBOZ and the head of OBOZ stays on to run OBOZ (query for how long of course). Second, there seems good alignment in terms of corporate and brand values & positioning. OBOZ seems established with well-regarded products. Third, shoes aren't necessarily a horror business. Yes, I recall MHJ shoes; but Berkshire Hathaway owns a couple of footwear businesses and they're well performed. Ie, H Brown & Brooks. Some of the Australian apparel/footwear chains have performed eg I had a terrific run with Colorado some years back. Fourth, valuation seems ok. 10x EBITDA for a business that is capital light, with a track record of good growth - from the limited financial details I've seen, it's not obviously an overpay (yes, some risks from the lack of contracts, but I guess if they have well-established relationships, that's valuable too. Plus, how long would the manufacturing/distribution contracts be for anyway. One -two seasons?) Fifth, KMD might be able to leverage the OBOZ relationships to sell more of its other product into the US market. Some potentially large revenue synergies there (albeit that may not ever eventuate).
I agree this changes the risk profile of KMD and stretches mgmt further. They are also paying more for OBOZ in terms of valuation multiples than the multiple which KMD trades on - so a risk the market won't pay up for the acquisition. On the other hand it does offer some growth options.
The big question: would I have done it if I run KMD? The acquisition is not compelling enough in my view, so probably not. But I'm a risk-averse type of investor ...
PS. I'm also a BGP shareholder (much larger stake) ... with hindsight perhaps Rod should have paid up when BGP had the chance. I can't believe he would support the OBOZ acquisition, but at 20% ownership he doesn't get much more say in matters than you or I do.
Ultimately, the question is: how much confidence do we have in KMD board and mgmt to manage this well and deliver on the bullish scenario? hhhmm. Simonet has done well, IMHO, but the chair I worry about it. Esp. the lack of retail and international experience, his track record doesn't convince me. OK, ok, I tried to be bullish ...
You make a good case for the defence, jg, and the bullish scenario may well play out to be correct. A positive is that BGP supports the capital raising so I guess that means that Rod D is on side!
New Zealand companies have an absolutely outstanding record of buying overseas investments for too much and at the wrong time. Don't worry, Xavier's gonna show them how its done.
as at 14:27:21, Wednesday 21 March, 2018 (NZDT)
Briscoe Group supports Kathmandu capital raising
BGP
21/03/2018 14:27
GENERAL
NOT PRICE SENSITIVE
REL: 1427 HRS Briscoe Group Limited
GENERAL: BGP: Briscoe Group supports Kathmandu capital raising
Briscoe Group Limited (NZX /ASX code: BGP) today confirms it has participated
in the capital raising announced by Kathmandu Holdings Limited (KMD)
receiving confirmation of an allocation of 2,570,925 KMD shares from the
institutional placement for a cost of $5,553,198. It also intends to
participate in the Share Purchase Plan.
Rod Duke, Group Managing Director said, "We are very supportive of
Kathmandu's initiative to diversify the business and position it for greater
international growth."
For and on behalf of the Board of Directors
21 March 2018
Rod Duke
Group Managing Director
Briscoe Group Limited is a company incorporated in New Zealand and registered
in Australia as a foreign company under the name Briscoe Group Australasia
Limited (ARBN 619 060 552). It is listed on the NZX Main Board and also the
Australian Securities Exchange as a foreign exempt entity. (NZX/ASX code:
BGP).
End CA:00315840 For:BGP Type:GENERAL Time:2018-03-21 14:27:21
really intrigued that BGP, and Rod D personally, supports the OBOZ acquisition. He floated BGP and raised a lot of cash many years ago. At the time they talked of potential acquisitions. but BGP/Duke have never completed any acquisitions - except perhaps Living & Giving which was small, and the 20% stake in KMD. This was despite getting close on a few, I recall Baby Factory for example, and the ASX compliance listing for BGP (which always looked like an enabler for an acquisition. I thought ADH).
Why then does he support the OBOZ acquisition. Duke's stated rationale for why it makes sense could equally apply to BGP. Ie, BGP could also "diversify and position for international growth" through an offshore acquisition, but they've never done it. And apparently, don't want to (for reasons we all could understand). Yet he supports the KMD initiative. I don't understand the logic. Is it being consistently applied?
Perhaps it's a way to get growth and (overseas) diversification without risking the main asset - BGP - too much?
It will be fantastic for 2 to 4 years.Can't open enough stores in USA to keep up with demand.Canada next,then Brazil.
Then Xavier will resign for family reasons,just before it turns to custard.
Shoes sold off at a great loss.Capital raise to pay off bank debt.
Shareholders are saved as Rod makes a very reasonable takeover offer.[Reasonable for Rod}.
“Reasonable for Rod” lol
This acquisition probably isn't a splash in the water kind of move that investors like, but its a well calculated move to grow without putting too much pressure on the pace of store openings to bring all the growth.
For those that think Rod isn't entirely with this plan I'd say you're wrong. This is totally a Rod type move. By acquiring Oboz and as they have mentioned in the statement, they want to head into the wholesale market. Taking the wholesale market approach to expand into North America is totally the Rod approach, its very conservative and calculated. Its a way for KMD to sell more product without opening any stores, which lowers the downside by a lot if they don't do well there. I think they have learnt their lesson from the UK where opening stores wasn't a immediate hit. Its a bit different for Rod at Briscoes since he couldn't take the same approach cause it doesn't manufacture its own branded products, but Kmd do and this is a very similar strategy that Rod wanted to do when he wanted to acquire Kmd a couple years ago.
Its too easy to think KMD can do it all, considering their success in NZ and AUS its a easy mistake to think the same model works elsewhere. At the end of the day KMD is a manufacturer of their own goods who just happens to sell their own goods in their own stores too. The Oboz acquisition opens up channels and networks that will help them sell their product in overseas in the wholesale approach. If you looked at Adidas and Nike they used the wholesale approach for a very long time in a lot of countries and when their products grew too influential and sales amounted to the point where it seemed ridiculous not to open their own stores thats when they did. I think its a good approach.
The value of the deal is average on present financials, they are paying over $100 million NZ for about $5 million net profit for Oboz for the upcoming financial year, but the net profits are growing over 80% and revenues 36%, which probably if consistent then perhaps they will deliver 9 million net profit next financial year and from then on the profits will justify the price tag and bring a lot of future benefits for Kmd. On financial terms its average value, but for future profits and connections it brings then its not too bad. Long term holders its a pretty good thing, short term holders I don't think theres much for you.
Silverblizzard - good post but I reckon Rod’s/Briscoes main motive in ‘supporting’ the deal was not to dilute their current holding.
Good they going to participate in the SPP as well ...... all $15,000 worth. Cool!
What is their point of difference in the USA the home of retail? Not keen on their push unless its real low key.
At the moment I cant see what niche they will fill.
http://nzx-prod-s7fsd7f98s.s3-websit...661/277569.pdf
Michael Hill closing down its US operations.
Pumpkin Patch had its US backside kicked all the way to receivership.
And we have KMD thinking it can make the States work?
Different approach to the market - both PP and Michael Hill rolled out stores.
As the Grumbler wrote, different approach. KMD already sell via TradeMe and Amazon.Au here and in OZ. I expect them to take a similar approach, using Oboz distribution channels to stock in third party stores and to sell on Amazon. The other side to that though is I doubt KMD make many sales from such online channels and US already has plenty of outdoor clothing brands. Can they leverage Oboz brand to gain a foot in the door? Hmmmm...
This is pretty good news
http://nzx-prod-s7fsd7f98s.s3-websit...870/281641.pdf
Had my doubts about Xavier early on but recent performance probably more than just luck eh.
Momentum still building ....expect more good news over the years I reckon.
Yes pretty happy with trading update today.
A bit of upside when Oboz in the US starts contributing to sales.
Glad to have held these through the bad times of 2014/2015. Kicking myself for not buying down at the lows of $1.30 during Brexit in 2016!!!
And good news for shareholder Briscoes too!
Disc: I hold BGR.
Taking midpoint NPAT forecast of $50 million, that'll be a new record, beating FY2013 NPAT of $44.2 million.Quote:
Full year FY2018 earnings (after $2.0m Obōz acquisition transaction costs) are currently expected to be in the following range:
• EBIT $72 to $77 million (last year $57m)
• NPAT $48 to $52 million (last year $38m)
Should be back over $3 soon!
I'm thinking FY18 dividend will be bumped up to 10c.
Looks like a good result.....sales, profit up.
http://nzx-prod-s7fsd7f98s.s3-websit...010/286923.pdf
Wow what a result!!
Makes Mr. Dukes investment in KMD look like an absolute steal.
OK, I'll say it......good on ya Aussie, reversing the share price slide, for the moment at least. http://www.thebull.com.au/articles/a...ong-sales.html