WHS - Warehouse Group

[Basil]

Hey Winner, your mate Joan is leaving in Novcember next year....but its all okay because we have Tony Carter of MFB, AIR and FBU "fame" should that be "ignominy"...yes I think so, joining the board.

Our ecosystem goals were too ambitious. That's polite corporate speak for:, we finally after all these years woke up and smelled the coffee and realized Nick Grayston had no idea whatsoever what he was doing.

https://api.nzx.com/public/announcement/442474/attachment/432615/442474-432615.pdf

Lots of talk about turning around the ship and shareholders deserve better.  Hmmm...seems to be a very common theme with certain companies lately.

[lorraina]

Wondered where the Nescafe 180 gm jars of coffee went.The board giving them the sniff test.
Pity, as out of loyalty I went to buy two jars on Monday at $9.00 per jar.
Out of stock.Really.?
Forced me to buy at New World using my club card at $8.99 per jar.

[Goob]

I didn't realise how much of a juggernaut the KMart NZ business has been. Over the last 10 years (from FY14 to FY24), it's grown from $263m sales to exactly $1,000m. The CAGR has maintained at 12% over the last five years — impressive given that includes a large cyclical downturn for the NZ consumer. This growth hasn't been at the expense of margins either.

Over those 10 years, The Warehouse Red Sheds have only grown modestly from $1,665m to $1,792m. Kmart taking huge swaths of market share.

[Dolcile]

Yeah, the warehouse and kmart seem to be chalk and cheese - at least in my experience.

[Basil]

Over those 10 years, The Warehouse Red Sheds have only grown modestly from $1,665m to $1,792m. Kmart taking huge swaths of market share.

Plugged that into the RBNZ inflation calculator https://www.rbnz.govt.nz/monetary-policy/about-monetary-policy/inflation-calculator and in constant inflation adjusted dollar terms, (real terms) WHS sales should have grown from $1,665m to $2,179m over the last decade.  My contention is that WHS is a company in systemic decline.  Share price tells you that to.  Was $4 a few years ago now struggling to hold $1 and at risk of being removed from the NZX50.

By comparison a retailer that's really humming, Glassons Au sales have grown from $36m ten years ago to ~ $250m, (my forecast) in FY25 a ten year CAGR of just over 21% ! and if they keep growing at that rate for the next 5 years their sales in FY30 will be ~ $650m !
Disc: HLG my largest holding, very slightly higher than TRA and I sold out of WHS several years ago at $4.10....ask me how pleased I am to have sold out at that price lol

[KW]

I went into the Warehouse to get some small things for my nieces - I was shocked by how expensive everything was.  Makeup/skincare items were all $30+.  Its certainly not the place "where everyone gets a bargain".  I was looking for items priced under $10, what little was available in that price range had already sold out.  If I wanted to spend $30 per item I would go to the Chemist Warehouse and buy branded items, not the fake knock off stuff the Warehouse is currently selling.

[winner (n)]

JB HiFi NZ sales up 20% on pcp for half year yo December

Some from new stores but same store sales pretty positive as well.

2nd Qtrstronger than 1st quarter ad well so things oolong better for them

Can't imagine Noel Leeming doing anything like this...still going backwards I reckon

Easy to see whose winning and whose losing eh

[winner (n)]

Oh dear, another update

H1 EBIT say $18m and 'best estimate of H2 FY25 EBIT is that it will be broadly in line with the H2 FY24 EBIT* loss of circa $14 million."

$18m less $14m not much eh

And that's EBIT ......suppose a sizeable full year LOSS at NPAT level

But never mind as they have a Fighting Fit Plan

What a disaster but the real sad thing is they don't seem to blame themselves for this mess .....it's the economy stupid.


https://announcements.nzx.com/attachment/438806.pdf

[Basil]

Gosh what an absoluite shocker.  How on earth do you sell circa $3.2 Billion of goods and make a loss ?
Ever thought about putting your prices up lol Honestly, I think management are total Muppets.
By contrast, last time I looked K Mart N.Z. sold about $1 Billion and made from memory something like $100m !

The entire board needs to resign.  Its clear they have no idea whatsoever how to run a profitable business.
On the other hand, we need to support the WHS and shop there.  It's quite clear the Tindall foundation's goal is to run the world's largest chain of stores on a charitable basis and sell things at cost or below lol

[Minimoke]

I wonder how much value the Rainbow Tick is achieving.

[LoungeLizard]

It's pretty clear that WHS's business model is broken and they don't have the Board or Management that knows how to fix it.

Briscoe's and KMART offer a much better retail experience for the same, or better, price. And unlike WHS they are very focussed on product margins rather than numbers of stores and turnover.

 WHS need to look very closely at the performance of each and every outlet, downsize to fit demand and at the same time get rid of the zero margin tat that fills their shelves and look to compete in product lines that actually make money. None of this is rocket science, but there's no excuse whatsoever, as has been said, for a company that contrives to make a loss from over $3 billion in annual sales.

No dividend for shareholders this half surely?

[Minimoke]

On a positive note. Could be good for a new supermarket chain that needs established retail footprints to set up in NZ.

[LoungeLizard]

On a positive note. Could be good for a new supermarket chain that needs established retail footprints to set up in NZ.

Yep, excellent idea. Maybe the Government could buyout WHS and lease the sites at a discount to LIDL etc? Could be worth it if it finally breaks up the supermarket duopoly.
But hang on - that would require the Government to "intervene" in the economy, something the NATS are pathologically against.  

[winner (n)]

You'd think that our Joan would resign  now ....years too late

Let the My Food Bag man or the Ryman man take over

[entrep]

Incredible how long I/we have been bleating in about how Kmart is eating their lunch, FOR YEARS, and yet nothing is done about it. One of the most poorly run companies on the NZX.