Originally Posted by
Halebop
Jewellers have been a beneficiary of Covid - substitution spending due to restricted entertainment and travel options. The elevated sales and margins will no doubt pare back when we get to something closer to an old normal but this likely has a couple more years to play out.
The interesting thing for me is that MHJ normally operate with around $5-10m cash and $35m Debt at year end vs $72m Cash and no debt at last balance date. So they are operating with around $100m in surplus capital or almost 26 cents per share. A stronger half year would further augment this. Caution and first lock down near death experiences no doubt prompt this liquidity conservatism but suspect a combination of higher dividends, capital returns, buy backs or acquisitions in MHJs future.