Not you - and that's the pertinent observation to make.
FYI - at my entry point, HLG has comfortably outperform Briscoes & WHS by a long shot. Not bad for a long term investor huh?
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Some people will have made over 35% and more on HLG this year we did.
As for the transfers they are a stop gap measure and no one should have paid any of it back until an accounting standard that created a capital reserve in the balance sheet. That is smoothed over a time period and that credit balanced back to the IRD. It is not a moral standard that needs to be met but an accounting standard that created fairness. That is simple double entry and maths.
Correct, a large part of HLG's attractiveness is the dividends. Correct Balance and I noted the improvement in gross margin with WHS too, (a not inconsiderable 170 bps) with the higher exchange rate. Plenty of clues in there for people looking for an attractive retail company where shareholders best interest are always put first and foremost.
very selective in your return analysis
if you took BGP share price at the 30/01/09
74c
and hlg on 30/01/09 of $2.14
it is very obvious who has performed better and compare the charts side by side of bgp a nice steady uptrend which is consistant with a growth stock against the hlg chart which is irratic to say the least and is consistant with a non - growth stock
Close today at $6.70 highest close since ex-div
That's good and spring board for it going higher
the B Team magic is working well.
Saw Trevor Mallard in a Hallensteins store the other day
Retail sales booming in Australia ...Nov sales exceed experts expectations
And how about this bit from ABS - Monthly rises were also significant in Clothing, footwear and personal accessory retailing
Chart looks cool
Such a volatile SP, currently in uncharted territory, history shows this can disappoint for literally years before another round of drinks. Smash your capital and ruin your sleep.
Current proponents espousing here are experts at market timing, masquerading as longer term investors these gurus are adept at momentum trading and ... let me tell you... looking on with as much trepidation as opportunity. Fingers not far from the trigger!
Gone in a flash they will be if it can’t hold the new highs. Bless them. Don’t get to be a real guru by just talking your book.
Uncharted times too
The fat lady has sung for MetLeftcare, Abano, soon will do so for Bonus Bonds
On top of this an avalanche of cash out there - created by Govt, not spent overseas, Term Deposits etc all looking
for a better than bank miniscule usury rates return -- where is it all going to go ?
A diminished number of listed dividend paying stocks with prospects perhaps ? ;)
what happens when a tidal wave of increased demand & available Loot on the loose hits a finite supply available ?
perhaps something like our housing market & sharemarket similarly all strengthening ?
Maybe we can discount volatility factors in current economic times ? ;)
Many stocks I have analysed do not appear to be following previous years trends .. I may be wrong though
The wage subsidy and retail: Which stores got it and who has paid it back?
Retailers are facing a moral quandary over whether to pay back the Government’s wage subsidy, with more and more big box stores deciding to return millions rather than face public backlash.
Hallenstein Glasson
The fast fashion retailer saw sales recover after a big decline during the alert level 4 lockdown but said it had no plans to repay wage subsidies it received.
https://www.stuff.co.nz/business/123...s-paid-it-back
Bull please stop with this? If the Govt Auditors have an issue then they will sort. This is a tired conversation....
Disc. Just brought some yesterday...
its news relevant to hlg so i can post it , if you dont like it too bad dont read it.
I am get a bit tired of the speech police on this site telling me what i cant and cannot post on a thread if they do not like it esp the ones who see posts as a negative on there one way ramp.
No sweat, Gwd - bull... is obviously short, caught or missed out and has run out of ideas of how to ramp the sp down to suit his purpose.
Simple solution - he goes on ignore and I suggest everyone who has enough of his garbage do the same. No point reading repetitive garbage which no value.
i am very surprised by the lack of understanding by people on this site and esp this thread on how such things if they gain momentum can effect a brand. it is obvious the pay-back of the subsidy is gaining momentum and companies that do- not may be effected. for me being short i am not but maybe i am a activist share holder for all you know.
anyway ive had enough of this thread i leave it to the less knowledgable to keep ramping there short term agenda
Hmmmm we are in the age of the 'cancel culture'. Last thing we would need is 'instagram models' posting selfies with #boycottGlassons or #boycottHallenstiens. It's something I've been thinking about...
However, having talked to some friends whom are very 'woke' last week, it is clear this issue just isn't that cool or hip. So little risk of customers voting with their feet and shopping elsewhere it seems.
Retail has been booming whilst people have been unable to spend money on international travel, I wonder if this level of spending will continue when we are able to travel again?
It was a WAGES subsidy bull dont you realize... not a company subsidy. The govt made it very clear the money was to be paid to employees and that they should be paid 80 percent of their pay. WHS went even further and paid the full salary. If the companies that took the subsidy went and paid other overheads with the money or didn't pay employees at all then pay the money back. If the money was paid to staff then how possibly can the company repay that back. It would be the staff who have the money now butbit would be ridiculous for the govt to ask them for it back. I suppose you would disagree lol
Think I can see why ‘it’s a thing’ .....good stuff and some prices look pretty cheap.
Just a bit of competition - no worries
https://nz.shein.com/?url_from=nzgoo...xoCSxAQAvD_BwE
Op shops are doing very well in the clothes department.
Quite a few well heeled young ladies buying out our way ....plenty of good branded stuff they say
There are a range of uncertainties but I am modelling up about $24m for 1H FY21 up just on 50% on last years $16m and amounts to ~ 40 cps. Who knows what the dividend will be but they have truckloads of cash already, no debt and I am sure it will be dramatically higher than last years 15 cps.
This is based on sales for the first 26 weeks continuing to grow at the same rate as the first 18 weeks (14.5%), and the gross profit percentage increasing 1.8% back to the level prevailing in 2018 of 61.5%. These two factors alone add $16m in gross profit for the half year. Increased percentage of sales though online channels will add distribution and selling efficiencies.
Please don;t shoot the messenger or kick the dog in the head if I am wrong. DYOR and Merry Christmas and a happy new Year !
Oh I see we aren’t allowed to use industry standard comparisons like 5yr returns with you, instead we have to use your supposed comparison standard of....11 years and 10.5 months.
And once again you have ignored dividend payments since then, giving an incorrect investment return figure.
Personally I think the 5 year performance is a much better indicator of how current management has been performing in a timeframe relevant to investors.
On the news tonite - Paymark says Pre-Christmas sales are down 7% so far this week. But they expect big sakes tomorrow.
Yeah except in this case the mum (JA) says to the other siblings things like "Johnny got 10 bucks off of his father (GR) Johnny's getting rich at your expense and there is no money left for you lot. And by the way there's no dinner tonight". The mum knows thats a half truth and that it will make the others angry with Johnny. She does it because Johnny is her step kid and so she plays favoritism. Question : how's that fair to johnny
I give it one shot to put you on the right track:
Government gave money to HLG who gave money to staff.
Now, if HLG were to do the right thing then:
HLG would give money [back] to government and staff keep money given to them.
Disc: I am having first slice of freshly delivered XMAS log roll and nobody is taking that away from me.
I disagree with witchhunts however why did Freigtways (freightways information services ltd), an essential service company claim over 330k of wages subsidy. Please correct this if FIS is not a subsidiary. Other organizations which claimed for a limited part of the operation that was affected were told they could not if the overall business was not impacted
Hard to believe people are still, after all this time and fierce debate relitigating this old chestnut. HLG's position which really is quite simple to understand.
https://www.stuff.co.nz/business/ind...wage-subsidies
At the time nobody knew how bad the pandemic was going to be or how long it would last. There was either going to be widespread layoffs or the Govt was going to give support such that instead of a truly dramatic rise in unemployment, companies could be in a position to get going quickly again by paying part of the cost of staff to keep them on.
In effect it was cheaper for the Govt to make part payments to keep people employed that make massive unemployment payments.
Do we ask people who were unemployed to repay their benefit when they get a well paying job ? I rest my case. Not worth me getting my fur matted up again and I suggest not worth others getting hot under the collar about. Time to move on. Peace and goodwill to all this Christmas season.
Poor Beagle: Definitely a Pavlovian Dog.
Disc: The mushrooms & other trimming on the XMAS log roll were made from pavlova.
I’ve assessed HLG lost about $14m of sales during lockdown. Lost margin $8.4m offset by wage subsidies. No impact on profit in F20.
A fair chunk of those lost sales have been recovered post lockdown (Thats why sales are up 15% YTD) - let’s say the recovery of lost sales has contributed $5m (after tax) to profit this financial year (this would be in your $24m number)
Conclusion - it seems HLG have benefited financially (ie made money) by about $5m (maybe even more) from the wage subsidy.
The wage subsidy went to workers, not the company. Would you prefer that HLG sacked the workers to save money during the lockdown and re-employed them afterwards? That would have saved the company the 20% they had to pay the workers, and then they still would have made those post lockdown sales resulting in even more profits.
HLG met the threshold for claiming the subsidy on behalf of their workers. It wasn't just a 30% drop in revenue during the lockdown, it was 100% drop.
All well and good jantar
Did HLG have a disaster plan / business continuity plan which might have guided them through bad times, including lockdowns?
Nonetheless I suppose my point is that since lock down they have recovered extremely well and over March/November are well ahead of the game and they have made money from getting the wage subsidy. Other retailers have experienced this (making money from the subsidy) as well and decided the right thing to do was to to repay it. The wage subsidy was good to get at the time but as things recovered strongly they concluded they didn't really need it in the first place.
There should be not repayments until an accounting standard is implemented by the IRD in conjunction with the accounting society. It should remain on the balance sheet until the IRD takes the credit back after a smoothing of the last 5 years. It really is not a matter for anyone in the public except the IRD and the standards body. The idea is good and the implementation by the government is not so good.
Its a balance sheet issue not a moral one. The public have got it wrong and so has the minister of finance and the PM.
I doubt any company pre-covid had a disaster plan for Government mandated 100% business full stop nation wide. Your usual disaster recovery plans if you're not global company would be having warehouses/shops/infrastructure in differrent locations throughout the country. Or closing down stores that don't perform and consolidating to the better location as most of travel companies did now.
Returning subsidies makes no sense if business payed employees. That's what the subsidy was for. Couple loud mouths on FB and in media won't do anything about it as it's obvious most don't care and buy there anyways.
Eating and typing at the same time is a bad habit ... sticky fingers can do terrible things to keyboards :) but anyway - enjoy your early Christmas log roll before it melts away - or do you live these days in colder regions of the globe?
Merry Christmas ... to you and all the other great and helpful contributors on sharetrader!
I'm not sure I agree with the conclusion there was no impact on FY20. Lost margin is lost margin (per your calc $8.4m). Whilst the wage subsidy was banked a portion of it was paid to employees and there were unfunded overheads. We need to look at all the variables.
The wage subsidy of $10m is in 2 parts. First part (5/12ths of $10m) paid a portion of wages during lockdown with a nett negative effect given the subsidy did not fund 100% of wage payments (another loss of what - $1m?). The second part (ie the 7 weeks funding post lockdown of about $5.8m) would have positive impact given it went into the "general pot" post lockdown. But overheads incurred during lockdown were unfunded (5/52ths of {$134m less W&S of $45m} less say 20% saving = 9.6% of $89m x 80%} of about $6.8m loss. Note IFRS16 muddies these waters so overheads includes interest on leases. Then there was another lockdown which would have cost HLG but is outside the scope of FY20.
Impact on FY20 (back of the fag packet) suggests:
- Lost margin -$8.4m
- Part 1 wage subsidy loss est. -$1m
- Part 2 wage subsidy gain of +$5.8m
- Unfunded overheads -$6.8m
- Total impact = -$10.4m
If we look at the annual report, NPBT fell $2.7m off the back off fundamentally the same sales YoY so there was an impact somewhere because that result includes $10m of COVID funding. Note I am using NPBT to account for IFSR16 changes.
Net profit movement reconciliation:
- HLG lost -$2.7m in FY20 vs FY19 with the same sales
- Add back lost raw GP FY20 (HLG fault, not COVID) +$3.3m
- Add back extra lost raw GP FY20 (at 5/52ths of the above) +$0.3m
- Add back lower non-operating income $0.7m (not COVD fault)
- Deduct wage subsidy funding (W&S reduced by subsidy per AR) -$10m
- Subtotal = -$8.4m (this would have been the change in profit without the subsidy and assuming the GP % was the same)
Note the subtotal above is the impact before accounting for lost sales and margin. This figure is your estimated lost margin of $8.4m.
Normalised impact is:
- Impact per part 1 above -$10.4m
- Remove impact of lower YoY margins +$3.3m
- Add annualised impact of lower margins +$0.3m
- Remove impact of non-operating income +$0.7m
- Nett "normalised" impact is loss of $6.1m
Whichever way you look at it there was a cost to HLG. It was either either $10.4m (raw), $6.1m (normalised) or $2.7m per the AR.
The Vueve Clicquot champagne is going to go down so very much better,
knowing
that there are two-faced hypocrites out there, walking around with hijabs stuffed in their posteriors,
spoiling their festive season with wage subsidy in their minds. :t_up:
Another way of looking at this:
Start with the AR 2020 NPBT $37m
Add missing margin per winner +$8.4m
Deduct COVID subsidies -$10m
Amended NPBT = $35.4m
This method shows HLG was heading for a lower NPBT before COVID struck, assuming the $8.4m is correct.
The lower profit can be see in the higher wage costs before COVID of $45m + $10m add back vs $51.7m in FY19 giving extra pre COVID costs of $3.3m. We also know the GP% was worse in FY20 by at least $3m. The change to IFRS16 had minimal impact.
One complicating factor is the lockdown periods were different in NZ vs Oz.
Winner - would you like to share your workings on the lost revenues of $14m?
I have this strange bizarre feeling, there might be something slightly better to do at this time of year than endlessly debate this subject even more endlessly than it already has been ;)
Excellent post. I put some of it in bright blue and highlighted it so the socialist lefties conducting their witch hunt can read it even with their one eyed myopic vision ;)
It is a real pleasure having you join the forum this year. I look forward to reading your well considered posts in the future.
Definitely salivating this year as my nephew who is one of Auckland's top chef's has moved into a new house and invited the whole Beagle clan around for Christmas lunch. Pretty sure Pavlova will be served as well ;)
Merry Christmas to all and best wishes for the holiday season.
Excellent analysis there Ferg
My thoughts too - 100% of subsidies had to be paid out (or unpaid portion returned)
I'm of thoughts that the way reporting the subsidy is flawed, in reports of listed companies
The legislation provided that the wages paid from subsidy & subsidy were non taxable / non deductible
It's questionable whether wages paid up to subsidy level were even a company expense, perhaps
net off (with associated note of what was netted off) would have been more appropriate.
The true wage cost over subsidy period is in fact the amount in excess of any subsidy, which the entities
paid out & wore at the end of the day
Add on AC Levies, Kiwisaver, HP and all the extra Remuneration oncosts associated to arrive at figure
for Overall net outgoing when Covid times trading was negligible / stores were closed
but just MTCW .. ;)
Merry Christmas to all and best wishes for the holiday season !
I agree that the whole debate is overdone. There was obviously huge disruption from the lockdown and HLG were eligible to claim. At one point their SP dropped to $1.80! Thats how dire things were looking.
The fact they have recovered well should be celebrated, not shut down as a negative. Its almost like some people would prefer for all businesses to have not bounced back and struggled.
If they made a large profit during lockdown or during the wage subsidy that would be a different story, but a lot of these companies have performed well several months after the restrictions which keeps people in their jobs and our economy running.
Hallensteins has also performed well because they have spent several years focusing on e-commerce and have benefited from that tailwind, alongside good management.
Enjoy your Christmas everyone, excited for another big year ahead!
Jeez - you have a serious problem ... and it's not just related to hijabs ...
I hope that this festive season gives you a chance to reflect and to work on this issue ...
It is so sad ... and your hate and spite devaluates many of your otherwise useful posts.
Let it go ... and enjoy the season. No matter what you believe (if anything) - but I hope the spirit of Christmas manages to touch you. It is the time of love and forgiving ... maybe you could even try to forgive the people who didn't do wrong :):
Merry Christmas!
I think anybody here does know your views on these issues. Personally I don't share them, but this does not invalidate them and clearly should not stop a civilized debate.
However - you are often sounding like a broken record, providing the same message again and again without adding anything new or useful. Even your spite is neither new nor useful.
Feels a bit like the rants and tweets of a recent US politician we both seem to despise. While I don't think that he is able to improve, I am sure you could :):
Merry Christmas.
"I'm of thoughts that the way reporting the subsidy is flawed, in reports of listed companies"
A comprehensive standard was needed with the IRD working in conjunction with standards body of the accounting society.
The balance sheet is the appropriate place for it to held until the IRD administers the credit applying rules for it apportionment.
Its a total stuff up and really shows just how little this government understands business and accounting for business.
You need a little library at home on the subject to be aware it exists but that is not what the minister of finance has on his book shelf.
Of more concern is the damage to the supply chain for retail clothing and in the next 6 months manufactures world wide will be suffering much higher debt ratios from stock piles of unpaid jeans and tee shirts.
Garment factories world wide are now struggling to pay works and keep there factories open. The supply chain has been hit hard and here in NZ you cant see that damage.
At Glassons Sylvia Park. Queue for fitting rooms is 15 deep and no evidence of supply issues on shelves.
"15 deep" , That means aucklanders arnt at the beach yet? Shortly im sure!
There will also be a lot of stock being dumped if you can buy and ship it.
The one resource really worth investing in for the future is water..you do need a pair of pants but you need a lot more water and everyday.
Glassons going to the dogs
Did not have my camera out the other day but the local hunt club had a lot of beagles in the kennels the other day make a lot of noise as i rode past. Im sure Mr B will be along shortly to comment on that fabulously fashionable 4 legged shopper.
The punters seem to be pretty happy with the way things are going
The HLG online store marketing machine seems to be going hard out with daily / twice daily
promo emails coming in .. if this continues may have to look at topping up again .. ;)
Getting ready to hit $10 sp in 2021.
You read it here.
Bombarding people with promotional emails is not usually a good sign.
It's clear Hallensteins is trying to get sales coming through, whilst Glassons is the becoming the clear star performer of the group. You can see when you shop at the malls in auckland, one has a lot more foot traffic than the other.
Sweeping generalisation here, but women tend to buy more clothes than men, so maybe hence the disparity in numbers in stores.
In any event if Glassons' sales increase while Hallensteins' remain about the same - still a win.
talking to some teenagers and they say the demographic is under yr 10 mainly cheaper stuff appeals to parents , older aged teens according to the ones i talked too now regard hlg clothing as the crinch brand. anyway they do well in there demo group
Very good point, Jay.
Was at Dressmart the other day (wished I weren’t but that’s another story) and all the women & unisex shops were packed to the door but not so, the men’s stores like Barkers, Rodd & Gunn, Rembrandt & Working Style. It is just the nature of things - females love to shop and try out outfits, most males cannot wait to get the hell out of a shop (unless it’s a pub!).
It still makes money and is pretty consistent. I think most of the investment (especially AU), should go into Glassons though.
They are clearly starting to target a younger demographic (under 25), so we'll see how that goes. I've also noticed they are chasing higher margins as they are not discounting as deep as they used to.
Perhaps hallensteins should consider capitalising on the now established online fulfilment infrastructure and create some innovative new online offerings for men. I'm thinking a subscription offering might be good - with a set per month fee that delivers a range of socks/underwear/tees etc every month which changes with the seasons, and a corporate offering that offers shirts/ties etc as well. each month comes with a discount voucher for in-store shopping. I know I would appreciate something like that as I loathe clothes shopping.
Perhaps a combination Pub / Men’s clothes shop could get the Hallensteins side back on track?
Not something that one doesn't subscribe for to be on their opt-in email list though - is it ? ;)
Bombarding - I wouldn't think so
Quality of promos - fairly polished & well presented
No complaints here
MTCW
Happy New Year & a prosperous 2021 - All .. as we hope to see HLG hit loftier heights & further achievements in 2021 !
If HLG hits the big $10 in future then how would a 2:1 share split go down ? ;)
As they say, one "Swallow doesn't make it Spring", but have heard some intel that more than 1 Glassons hit record sales figures on Boxing Day.
Fingers crossed that is representative of group sales. :-)
Shopping , a therapy. When in a stressful place, shop till you drop.
Looks like it's heading that way
First stop $7 this week ....and after update early February it will be above $8 and then punters will realise that full years sales will be up 15% plus and the B Team forecast of a 50 cent full year divie is on the cards
No worries
Just to cheer the B team , perhaps by then it will have to be called the A+ team. And it will be a better buy than ATM... well it pays a dividend!!! and then NZX 50? NOW WHERE IS THAT BARK . Very loud barks at the Hunt club today.