I wish I was able to go James. With the S/P rising at a steady rate, there must have been some great snacks on offer at the annualmeeting. I am also keen to hear from anyone who attend the meeting.
Printable View
No great snacks at the AGM. Just your regular type muffins, apple or blueberry, if my memory is correct. Nothing extraordinary was revealed at the meeting. Really, if you read the transcript of Peter Mertons address then you're pretty much in the loop. He did add that they expect opportunities to arise in the healthcare field, but also said that it was hard work out there, especially in retail. As for the recent rise in the share-price, I doubt if it is anything to do with anything said at the AGM. My guess is that a fund has decided to take a stake, or increase an existing holding. Because this company is so tightly held, they have had to bid up the price. The top twenty or so shareholders control about 80% of the stock. While one shouldn't grumble at a rising share-price, I was quite happy buying the stock at around $1.20, but it would seem as though those days are now in the past.
How is the NZ flu season going? Long winter?
Thanks for the info on how tightly held it is. That was my understanding too. Hence the low volumes and the increasing price. Kind of like how Briscoes use to be. Then again... I could be wrong. I like the tightly held aspect. Shows good support and clever thinking, why have many many small holders.
Up and coming dividend. Any one know what the divi may be?
Very happy with recent acquisitions by GXH. Pity I didn't get in at $1.15 when the stock was on my watchlist but management certainly seems hell-bent on a expansion into healthcare which looks a better long-term play than retail in pharmacy businesses. I wonder if we'll see them sell off that arm of the business in years to come?
Hi Benjitara. I don't believe they will sell the pharmacy side out too quickly. On another matter if someone visits the doctors, they need a pharmacy, more doctors visits, more pharmacy use. Growing population with a dependence on doctor prescribed remedies. I look at America in regards to the growth of prescription rates. For me, this one is a keeper long term. Most interested in the up and coming dividend news... when ever this may be. I wish they would offer more shares to current holders to raise capital for further expansion/acquisition as well.
if i didnt pick snk and sli this stock may have had me leading the competition lol
Anyone know when the DRP shares would hit your holiday for GXH?
Very Merry Christmas to all the GXH holders and people who bother to read this thread. Let 2015 be another excellent year.
You will have received them on Friday at $2.115 per share:
https://www.nzx.com/files/attachments/206004.pdf
Would GXH make an interesting buy out/take over by a much larger overseas based company?
Nice to see Grant Bai - CEO of GXH purchasing 104 080 shares on market for a lazy $2.10 per share.
If a man in the loop knows a thing or two about running a profitable company with a forward driven market segment, I would anticipate that his expectancy on return is better than average, plus chances of achieving this, to be nicely weighted.In my view, a good time to buy after a high of $2.40 only earlier this year. Still a good option for those considering their portfolio egg mix.
Operating revenue should increase a bit due to recent acquisitions. Look forward to this years end of year results.
I'm expecting results to be published next week but can't find any date on their website. Is there any formality required to the date that a company reports? It seems quite backyard to just post without setting a date.
They need to publish results within 3 months of the end of the financial year. Some companies announce their publication dates in advance, others don't. However - if you really want to know, just ask their investor relations person. The announcement date is not normally a secret, some just decide not to publish it.
Disappointing result for mine. Flat profits on revenues being 25% up and the Pharmacy margins actually down. With medical acquisitions only being about 10% of turnover I'll have to take a very long-term look on this stock.
DISC sold some on report.
Sold my remaining shares today. I was expecting a narrow margin on the home care aquisition but it was less <1%, which is lower than I expected. Was also not expecting pharmacy side of things to be down.
This company is one I can see getting eyed up for a buy out or acquisition, if they don't try to dominate this sector themselves.
Well run business, not the easiest environment to be operating in, yet a sector the community can't do without. Not letting the slight sidestep effect my holding position.
Long term. Big win.
You might need to factor the actual declining rate of of return on the core business of the pharmacy sector being dispensing with its lack of increase in remuneration since 2001 ongoing lower drug prices causing diminished returns from wholesaler rebates
caused by constantly lowering drug prices, the move to robotics causing a decline in the customer count because of the lack of interaction between patients and the pharmacist. they are buying pharmacies for well over the odds ,my friend got 40% ($500000.00) more than he expected from the market as they are splashing out shareholders money willy nilly and putting in managers who do not care enough to grow the business , the idea of having a manager will never match a owner operator although they have their own version of that but it is not a long term winner because of their business model.
disclosure, I am a pharmacist in business and have had them take over near me, we gained 10% business within a year because of their management style... being uninterested staff who do not really care for the customer
I agree, Owner operators are much more passionate and have a better, personal approach.
Market power, size of network reach.
I love visiting small boutique retail stores, this sector has shrunk dramatically in recent years. Pharmacies, which I have had several friends own and operate successfully, are under the same pressures. Some people I know through work, customers have been pharmacy owners. I know that I prefer personalized service, this normally comes at a cost. Paying a premium to buy out the competition is normal business practice, especially if you can afford it. Briscoes and GXH have some interesting similarities in the approach. Slow and Steady.
Slowely, the little holders sell up, and the bigger guys, accumulate. I see this company doing exceptionally well long term, if they can keep a steady pace on. Discount Pharmacy stores and online competition are certainly a threat. yet I have the feeling that they will take hold of this opportunity and also join in on this business growth area. Current sellers are selling in low volumes, and after Ex Div date. Perhaps a few staff who want to have a warm holiday away from the cold NZ winter, or go to enjoy the snow. No surprises there.
How many brands of pharmacies and blood testing practices/GPS do you see out there? If your sick, you want to get your doctors visit and medication today, not once payment clears and delivery happens. A lot of the people visiting pharmacies and doctors are time poor and in need of the service, so the wallet opens.
Certainly there will be challenges, yet they are doing a darn good job, in my opinion, at working through the implications that their environment puts them against.
This winter will see a huge number of people down with the flu, climate related depressions and spring, could be a wet one if the winter continues like it has started. I don't go to the pharmacy to get my sunscreen, yet I do go there to get my prescriptions when I need them.
Happy Thursday thinkers and doers, looking forward to the weekend.
Small parcels selling low. Wouldn't be concerned long term. This winters numbers are going to make for interesting figures come the interim 2015 results. Only a couple of percent increases in sales and numbers could spell good improvements in performance.
The most illiquid stock in my portfolio. The thing that prevents me from topping up is this exact reason.
While I don't think current overseas events will have a dramatic effect on GXH, if there is ever a reason that I have to get out of this stock, its going to be real painful.
In my opinion to justify SP >$2.00 earnings growth need to be >5% p.a. Recently GXH have been a disappointment in this department and I don't see that changing in the short term.
Disc: sold out after last report
I also sold out last report due to the fact that their core business (pharmacy) continues to struggle to produce profitability while the margins from their medical acquisitions tended to be smaller than I originally thought they would be. This led me to believe I couldn't/wouldn't PURCHASE the stock for it's trading price at the time so I sold out.
A business I monitor closely and I could well be in again if I see better operations in future reporting.
http://www.stuff.co.nz/business/mone...-the-superrich
Think there are some interesting points in this article that can relate to this enterprise and also the retirement sector, as they do have some synergies. Then again, it is from stuff.
I'm highly optimistic about GXH. Happy guess says $3+ by 2019. There will be a big shake in this sector that will cause a positive for this business. I only go on a hunch from what I see overseas. And ever more so, buyer behavior.
I know there are negative signals for retail, yet that's currently in transition. *Hold*
How much room for growth is there for GXH?
Being an NZ based business, there is only so much acquisitions they can complete without straying from their core business.
Good question. I guess their pharmacy wing looks quite saturated. Probably still lots of opportunities in the rest of the medical market (medical centre's, care), but they have not yet proven that they are able to make money in these other areas.
I would see as well lots of potential in increasing efficiencies in the pharmacy market. From a user perspective - they are are hopelessly inefficient compared to many overseas pharmacies, but this might be as well related to requirements of the NZ health system.
So I guess, I do see potential in NZ for a company in this industry to grow their profits, but I am not sure yet, whether GXH management demonstrated so far the skills to utilise this potential.
I've looked into companies that grow primarily by acquisition and also held some. When they start to sway from their bread and butter business, they tend to not do so well in terms of margins and return on incremental capital. Feel this might be the case with GXH.
Other thing is in order to grow eps, they start to pay more P/E multiples for the businesses they acquire.
Director buying (roughly 25k shares): https://www.nzx.com/files/attachments/240188.pdf
Ingenuous question here. Why did they give out such a great special dividend when their borrowings are so high?
What's the debt gearing on gxh?
Directors don't seem to be concerned about the gearing ...
Both Andrew Bagnall as well as
https://www.nzx.com/files/attachments/245710.pdf
Peter Merton slightly pop up their 43,6m odd shares (each) by roughly 31600 shares:
https://www.nzx.com/files/attachments/245711.pdf
(Not sure - could be DRP or director fees, but still good sign - they certainly have skin in the game)
+7.8% so far today. My question is: huh?!
Gosh ... the SP graph looks not very inspirational these days - does it? Cross of death in November and downhill from there on no news.
Suppose markets don't believe anymore in the growth story ... and on a pure PE / low growth basis they are obviously still significantly overvalued.
Discl: sold out around the XoD ...
I think that volumes are so low, that its really easy for share price to go up and down on no news at all.
Its a good business and theres still a growth story there. Good buying around these levels I reckon.
Volumes not that low - and we are talking now already the 5th month after the XoD, i.e. it is not a blib either.
But sure - markets can be wrong - that's what astute investors exploit. Not sure though, whether I'd see them at this stage as a bargain:
Looking into my spreadsheet: average P/E 23, forward PE (based on my guess ...) 16 and growth rate (based on the HY report): 7.7%; I'd say the current SP looks about right, but certainly not a bargain. For it to go up again, they need to pull in my view another rabbit out of the hat (which they might ... but I just don't see it).
I agree BlackPeter, not really exciting news here. I was hoping they were going to be able to improve their pharmacy business and come up with some better results. Price went a bit too high for what I perceived their value and return... so I sold out and with my gain purchased another lot of SUM.
Long term, still think they'll do better than average and not much competition, especially competition that is listed on the NZX etc.
I sold out a few years ago now after the substantial rerating in terms of P/E. I never thought the growth prospects supported such high valuation.
A bit of a head-scratcher this one. Had so much hype behind it but a lot of money being spent by management on acquisitions that were perhaps not the greatest. I also think investors got ahead of themselves a little bit on its future growth prospects.
A lot of the profit still coming from the Pharmacy side of the business, with the other two business units still looking like problem children. Also it would make me nervous that they haven't looked to be bold on any front.
Steve Browning (CFO) speaking in Auckland on Nov 15.
Details here:
https://www.sharetrader.co.nz/showth...467#post691467
I don't think GXH are prepared in competing with a company such as Chemist Warehouse. I think that the online platform is about 2 or years late and given that NZ is a small population as it is, it could be a rocky path ahead.
Chemist Warehouse is not a real pharmacy as far as I can see, their online catalog is not much medical. But then I don't know how much GXH depends on sales of cosmetics and snake-oil for its profits either.
What do you mean by snake-oil?
The stores I went to in Australia they were a pharmacy (prescriptions and all), not sure about our one. They stock a lot of products from medicinal to health and skin care. Have always made a point of dropping by (oz store that is) and usually come out with a few things. Glad they've opened in NZ, hoping for health competition in our over-priced consumer market.
They will need to act fast if they want any chance against Chemist Warehouse. Chemist Warehouse is ruthless and knocking back the higher wages for employees as a lot of pharmacies are simply not able to keep up with the discounts offered (in Australia).
The buying up of medical practices was a clever position as there is great profit potential as it is a technical enterprise, often with many many years of patient loyalty.
I sold out over a year ago as I was concerned for their long term as their pharmacy side did not impress me anymore. Prices are often a bit high in the pharmacies, where the service is getting ever less capable. Online companies such as Iherb and places where you can buy specialised products are also growing very quickly. Super market general consumer products which pharmacies provide has also increased a lot. I really like GXH and hope that they make some evasive maneuvers to keep ahead or watch their market share shrink very fast, and shareholders returns will dwindle. Keep your loyal costumers loyal.
Being able to buy homeopathic remedies in pharmacies is odd I reckon. Then again the placebo effect is real.
https://www.pharmacytoday.co.nz/news...-products.aspx
Hi all. It’s good entry point now $1.66?
The share price appears to be still in a down trend,having fallen in the past year, from $2.50 to $1.60.
Current eps are 12.87 cents,the PE is 12.9 and the yield is 4.22%.
It would appear the arrival of Chemist Warehouse in NZ, has spooked the market.
So if you are thinking of buying,take care.
At some stage I expect Ebos will take them over,but at what price,I do not know?
You obviously like them Justin
Share price way down from the close to 3 bucks not that long ago ..... when do you think the downtrend will stop ..... 150 ... 125 ....100
Good luck anyway .....might be an inspired pick for 2018
Percy - Ebos tend to not pay over the odds do they?
Have to admire how they do a plain language set of accounts ....more companies should follow their example.
Well buying GXH on a PE of 12.9 while their [EBO] PE is 21.19 would be seen as eps accrective.
EBO's 40% shareholder Zuellig, already is a joint holder with Andrew Bagnell via Peter Merton of control of GXH,so it would depend on either Andrew Bagnall wanting to sell,or EBO,Zuellig making an acceptable offer to Bagnall.
I have always thought Bagnall, with his interest in planes and cars, would be happier having a large holding in TRA.
Interesting things happening in Australia, with The Chemist Wholesale putting their supply wholesaler/distributor up for "tender".
The fun would be if Ebos won that agreement/contract.
GXH's current market cap is $237.6 mil,so EBO, as you point out they could pay cash.
I don't think they would issue shares,as Zuellig own 40% of EBO ,and issuing them shares would mean Zuellig would have to make a full takeover of EBO.
What I would find interesting is seeing where Andrew Bagnall invests,should he sell out of GXH.
There is a term in behavioural finance called overreaction bias which I think is at play. Basically, bad news is reacted upon twice as much (sometimes more) as good news. This is mostly due to an emotive response by people who have their money tied into a security. Certainly can see that with the slide from about 2.75 all the way down to 1.60 now.
I still think the longer term prospects on the company is very good given the trends at play in the sector. Would be a good time to get in and add too if you had a retirement portfolio. Short term, a lot of the heavy lifting is being down by the pharmacy side of the business.
I agree with you on EBO coming in and taking this one but its already pseudo owned by them behind the scenes by the looks of it.
I'm not too sure on mall shops. I'm guessing the play for GXH is to be paired next to medical centres that they own as well because the medical and pharmacy aspects really complement each other. People need to get their prescriptions, so this is what would drive foot traffic into the door. I also like the whole idea of offering flu shots in store bringing more people in.
Convenience is key I think, hence the online platform as well which looks like its mostly for their higher end, higher margin product.
Quite a spectacular bounce, missed the boat on this one!!
Well, yes - but still below MA 200 (i.e. still in a downtrend), and to be fair - while the volume was above daily average, it is not that spectacular!
You might get well another chance to buy in ... though I am not sure, whether this chance will be an opportunity. I see lots of competition both for their prescription supply (Supermarket pharmacies) as well as for their cosmetics (online) and haven't really seen yet any innovation from GXH in this area.
NZ pharmacies are so incredibly inefficient compared with many countries overseas - and if GXH is not improving the system, than somebody else will and reap the benefits instead of them.
great little uptick here. maybe still another 10% left in this run...
don’t think the (growing) older generation are really going to be that keen to ‘shop online’ for their health products
provided they can go into a well-run store, get great face-to-face assistance, quality health advice and good ‘old-fashioned’ service, no reason not to keep coming back, especially if stores can be ‘well positioned’ next to medical centres to help drive extra foot traffic…
filthy
I’m an online shopper for heaps of stuff but have rarely bought any medical supplies online.
Lets face it, when you are sick, you tend to want medical supplies asap. I can’t imagine too many people leaving their doctors with a script and then ordering online.
Cannot quite understand the recent price increase bearing in mind the entry into N Z of the Aussie discount chemist which has captured such a meaningful share of that market, but time will tell.
Hmm this is interesting, possible news incoming soon? Unless this is a sharp correction in the downturn.
Chemist Warehouse tending towards an IPO rather than a trade sale.
They touting as being worth $5 billion as well.
Maybe astute punters have taken this on board and applied same sort of multiples to GXH and worked they are cheap cheap cheap ......or maybe Chemist Warehouse have thought about buying GXH
To buy GXH you would have to get the major shareholders Bagnall and Merton on board.The Merton holding is tied up by Zuellig who are 40% owner of EBO.With EBO bidding for The Chemist Warehouse's wholesaler contract,it could be said "we live in interesting times."
I have been buying stuff on chemistwarehouse.au for the past year now.
Cologne, anti-histamines, toothpaste, shampoo etc.
Orders are usually free shipping for me and are received within 4 days... dirt cheap as well.
Telfast 180mg fexofenadine HCL NZD per pill
Life Pharmacy = NZD 0.92 pp
C. Warehouse = NZD 0.47 pp -49%
Nicorette gum 2mg NZD per piece
Life Pharmacy = NZD 0.39 pp
C. Warehouse = NZD 0.22 pp -43%
Lower prices are across the board with most OTC medicines on offer.
Until virtual doctors visits are finally introduced here, I will be getting scripts from the local chemist.
Hardt why not when you go to the DR get a prescription for the anti histamine ? I get loratide, and usually a 3 month supply so 90 pills for the prescription cost of $ 5.00 .
I just have a little list of what I need to stock up on , so when i sporadically goto the Dr I get a new Asthma inhaler ,Antihistamines , etc , etc as needed . Can't beat the cost of that .
Not online, but why not carrying your prescription into the next supermarket and pay only $2.50 (and sometimes no prescription fee at all) vs paying $5 per medication at the pharmacy to subsidize them for being inefficient? Many people need regular medication - all these $5 per medication do add up ...
nice bounce was a good pick i reckon to bounce
Good on 70 year olds driving their racing cars as fast as they can
https://www.stuff.co.nz/sport/motors...thurst-12-hour
Good news the 40% plus shareholder in Greencross will be OK and back racing again soon I expect
Wonder what his wishes are for this shareholding are if next crash doesn't have a good ending
Dropped to 1.60 yesterday and then back up to 1.69.
I see this one as mostly more of a retail play at the moment with most of the heavy lifting being done by the pharmacy sector. Obviously the long term play is on the healthcare side in NZ of rising population and also the retiree's.
My rule is to never invest in retail hence I haven't yet got in but tempting it is. Perhaps 1.50?
I guess the pharmacies alone are in my view quite inefficient, low (no?) growth and under heavy attack from supermarkets. The stock becomes more interesting if they manage to implement their vision of an integrated health care company, but it looks like the markets don't really believe anymore into their growth strategy. Show us the money - and the SP will take care of itself.
Not sure what it would be worth just based on the old pharmacy brands. One dollar would bring the long term PE (8 yrs) down to 10 ... and if we just take the last 5 years, than it would be even $1.20. Why pay more?
Chemist warehouse continue to apply the pressure
https://www.stuff.co.nz/business/105...rmacy-industry
Must be hard for the smaller pharmacy’s that they still have to pay the govt $5 for every script even if they don’t charge the consumer
They don't have to pay the government ... the article used a particularly strange way to express that the government subsidizes pharmacies in a big way.
The government calculate the retail cost of the medicine. This calculated retail price is high enough to make sure that even the most inefficient and worst run pharmacy in the country still will make a handsome profit.
Given that pharmacies are allowed to charge $5 prescription fee is the government than deducting $5 of this fictive retail price - and pay the reminder to the pharmacy for dispensing the medication.
Any pharmacy working a bit more efficient that the worst run pharmacy in the country makes a steal - and the discounters are prepared to return some of this steal back to the consumer.
Coming from overseas and with the benefit of knowing some different health systems I found NZ Pharmacies always expensive and highly inefficient. Good to see now some competition coming in.
poor old gxh investors hanging in there hoping for a comeback ... unichem maxx not quite the miracle cure then ...
According to the latest FS, the company makes 8.4% of profit on sales in the pharmacy segment (bottom line). Not impressive at all, and an introduction of a competitor that sells so much cheaper will lead that down.
With the current govt in charge and healthcare being viewed as a public good in NZ, its hard to see this being a home run. Even if it does well, regulation will get it eventually (see pay equity deal).
6% drop in the last 5 days ... sinking ship?
CW are taking larger and larger bites out of GXH's pharmacy business.
GXH need to focus less on operating standalone pharmacy's and more on the centres performance... Medical is going well.
Not a holder
Yikes! This is an awful result. That operating cash flow could be bringing in warning bells to go from 17m to 8.7m in just one year. It makes you wonder because pharmacy is so big and medical/community health really doesn't contribute that much right now
I'm not sure what they can do on the pharmacy side given the fact Chemist Warehouse want to expand like crazy. I went into the one in St.Lukes and the price differences are night at day on most things, so driving there to pick up a few things is actually worth it. Either way, GXH loses if they keep dropping their margins or keep margins the same imo because the market is so small.
Disc: Not a holder
Relative who's worked in pharmacies for years says losing custom to CW, despite being a 20 minute drive away
Hopefully a good sign.
http://nzx-prod-s7fsd7f98s.s3-websit...850/291821.pdf
Wow - SP at $1.14 more than 60% down compared to its peak value of $2.90 in May 2016 - and basically a textbook downwards slope since then.
Attachment 10259
Average (backward) PE is now 11.3 - still not really cheap, particularly considering that we might move into PE contraction territory.
On the other hand - for the right competitor they might move into takeover territory. At what time are they cheap enough for a clued up overseas competitor to just buy the lot for a song and show the NZ healthcare system how efficient pharmacies could be operated?
Assuming they won't run NZ largest pharmacy chain (with some other health ad - ons) into the ground - where is the bottom PE? At 10? At 5? And will these margins continue to shrink given that any newcomer will be cheaper and better. Hard not to.
You going to have a punt then BlackPeter
You need to research the largest shareholder.[controlling interest].
It is a joint venture between Andrew Bagnell and Peter Merton,who look to have premptive rights on each other's shareholding.
Then you have to research who Peter Merton holds for.Himself or Zuelig?
Then look at what company Zuelig holds 40% of.
If you find it is Ebos then you are on the right track.
At this point in time you would most probably be right to think EBO already controls GXH,as well as being their major supplier.
My guess if Andrew Bagnell ever wants out, then EBO will take it over.
Otherwise, should EBO decide there are more benefits for them to have, they will make a takeover bid for GXH.
Note Zuelig representitive and EBO director Peter Williams is a GXH director.