Retail Stocks

[Waltzing]

crikey... sell the BARN!!

https://www.youtube.com/watch?v=fVuSYUNAekc

[Waltzing]

JB HI FI just got HIT and Aussi Kangas look like they heading for the hills..

[Left Field]

KMD update looks good...... (heightens expectations for HLG!?)

https://www.nzx.com/announcements/406617

• Sales momentum has continued in Q2, resulting in record first half sales
• Group total sales for 1H FY23 (unaudited) are expected to be approximately $546 million, an increase of +34% above 1H FY22, with particularly positive trading in Australia.
o Kathmandu sales recovery continues, with total sales +51% above 1H FY22, reflecting a return of travel and tourist-related spend
o Oboz first half sales have rebounded from COVID-related supply constraints last year, growing +124%
o Rip Curl total sales have grown +18%, with strong growth in direct-to-consumer sales, while maintaining wholesale sales levels following strong growth last year
• Group gross margin remains resilient overall, with improved gross margin for the Kathmandu brand
• Underlying 1H FY23 EBITDA(1) is expected to be approximately $45 million, cycling $10.2 million EBITDA in 1H FY22, which included $5.1 million of one-off COVID assistance

[KW]

From Aussie ......
"The message from business is consumers are holding their ground, even after taking a pummelling from surging prices. But it's anyone's guess how long they can keep taking the blows.
From JB Hi-Fi, Dan Murphys and even car listings group Carsales, a picture is emerging of consumers still willing to spend after surging prices and an uncertain outlook given a slowing economy.
Helping this is a massive $300bn savings cushion built up by consumers through the Covid-19 pandemic, which remains the biggest driver of spending. At the same time shoppers are still catching up after been locked down for all those years."

It would be interesting to know if Kiwi's have built up an equivalent savings cushion.

[Waltzing]

In a bear market the rally's get sold...

Its great that there is this 300 BN... where is this number broken down?

Brain Sullivan often says Hopium.... hoping its not and its real retail demand...

[KW]

Its great that there is this 300 BN... where is this number broken down?

https://www.afr.com/policy/economy/household-wealth-hits-record-15-trillion-20220623-p5aw10
"Australians continued to add to capital buffers even as the pandemic restrictions eased, adding $40 billion to savings in the March quarter while the savings pool of the rest of the world declined by about $8 billion. Households have accumulated $305 billion in currency and deposits in the past two years.
That comes after about $200 billion was saved in calendar 2021, with about $25 billion added to household savings in the month of July alone."

Its interesting to compare those countries where people were allowed to keep working (like Australia) during lockdowns, and those that weren't.  An anecdotal tale of a small cafe and hotel in Ireland, who was forced to close during the Irish lockdowns.  They had a coffee cart, which they were allowed to continue operating out the front of their cafe.  They turned over one million pounds during the Covid lockdown, and that enabled them to survive.  In NZ of course, that would have been banned too.

[Waltzing]

yep AUS what , who , where we ae are all banking on....

go AUSSI Go... should the KIWI and the AUS been merged after all...

Yes and business and enterprise was sued and the business man won in NZ.

The first lock down was far to harsh... the AUckland lock down when people had jabs was criminal but try telling the GOVT that.

Water under the bridge now...

[KW]

TPW the latest to take a share price hammering, down 25% today.  Pulling back on investment in new categories (house renovation materials) because there is no more free money.  Expect that to be the case with all companies that have unprofitable or new business ventures.  Cashflow is King again.

[Fiordland Moose]

https://www.afr.com/policy/economy/household-wealth-hits-record-15-trillion-20220623-p5aw10
"Australians continued to add to capital buffers even as the pandemic restrictions eased, adding $40 billion to savings in the March quarter while the savings pool of the rest of the world declined by about $8 billion. Households have accumulated $305 billion in currency and deposits in the past two years.
That comes after about $200 billion was saved in calendar 2021, with about $25 billion added to household savings in the month of July alone."

That's a great article (the AFR is a fine publication). Another great aussie retail focused article for those of you with subscription or know the trick to bypassing the paywall.
https://www.afr.com/markets/equity-markets/retail-stocks-hit-with-reality-check-as-hawkish-rba-spoils-results-20230209-p5cjc2

But going back to KW's article there was a great bit of Jarden research on the aussie consumer sector published last week that said retail orientated to older consumers will fair best, followed by retail with young consumers, with the worst hit being those w/ middle aged consumers.  Those excess savings have been disproportionately captured by older wealthier people who are still feeling pretty chipper about life and spending.  The youngest don't have mortgages and are getting wage increases even if feeling pinched by rent and fuel. but its the middle aged with mortgages who are being knocked around the most.

Makes sense to me.

Been reading through various earning announcements lots of CODB pressure above forecast.  Clear to me my CODB forecast for glassons was a bit soft - so perhaps 1H FY23 npat probably in the high 20's - plausibly low 30's. Not that it matters one iota - a record result & big lift from the pcp.

hope everyone staying safe and dry.

[KW]

But going back to KW's article there was a great bit of Jarden research on the aussie consumer sector published last week that said retail orientated to older consumers will fair best, followed by retail with young consumers, with the worst hit being those w/ middle aged consumers.  Those excess savings have been disproportionately captured by older wealthier people who are still feeling pretty chipper about life and spending.  The youngest don't have mortgages and are getting wage increases even if feeling pinched by rent and fuel. but its the middle aged with mortgages who are being knocked around the most.

Makes sense to me.

In addition to lower mortgage payments over the covid period, a lot of consumers with children benefitted greatly from savings in childcare by virtue of their working from home.  Now they are being asked to return to the office, and childcare expenses are back along with higher mortgage rates.  Childcare is very expensive in Australia, especially if you don't qualify for the Govt subsidy.
 "Without childcare subsidies (CCS), we would pay $950 out-of-pocket per week, which was more than our $615 rent per week. However, with CCS, we would pay $520 per week out of pocket, which was still close to the cost of rent. "

[Waltzing]

Spend Spend Spend .....

"The rise in spending was led by an $80m increase in the durable category, which included furniture, hardware and appliances."

Now industrials are up in the US...

Winner() was wondering off somewhere yesterday as retail stats came out?

and with all those flooded homes insurance payouts will be spent not just on Car Car Cars...


https://www.stuff.co.nz/business/131297342/the-things-we-wont-stop-buying-even-when-were-tightening-our-belts

[KW]

https://www.stuff.co.nz/business/131346311/retail-sales-fall-4-in-december-quarter-as-consumers-feel-the-pinch

Retail sales totalled $30.7 billion in the last quarter, down 4% on the same period last year and 0.6% on the September quarter, according to Stats NZ's latest retail trade survey.
The fall was driven by a 15% drop in sales of hardware, building and garden supplies. Sales of cars and their parts also slowed, falling 10%.
While the overall trend was downward, sales volumes grew in the hospitality sector, with food and beverage services up 14%, and accommodation services up 28% compared with the same period last year.

[Waltzing]

HN AUS sales down .... ooops

[Waltzing]

DId it all go to Retail? ......

https://www.nzherald.co.nz/nz/winston-peters-what-happened-to-the-14-billion-covid-recovery-money/K4TWPEB75JASBFOFY3SNI2BUJI/

[winner (n)]

HN AUS sales down .... ooops

jeez ...Harvey Norman NZ saes down 12% in December quarter