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Goodness how the mighty have fallen and these results say it all.
Sales down profit down and it seems no matter what they do they cannot stop the bad ship from sinking.
Where are any good points for now, ok things might be better in 6-12 months but other things will come along to move them off track, and to start putting assets like fixtures and fittings in the books to look good beats me. Think we could see SP down to 25p ish.
Shows the damage recent entrants into their marketplace are doing, when the likes of Shein grow their GMV by 50% & Boo down 13% over comparable periods.
Little to be excited about here.
I think the fixtures and fittings are the value of the automation investment.
Oxygen, Shein relies on dodging import duty and cheap labour. Both under the spotlight. They could easily be derailed. Lots to unfold here over the next 12 months.
Yep I wouldnt touch Shien with a barge pole if it IPO'd
Just one overnight action could tank the stock. It be like buying a mining company solely drilling in North Korea, Yemen or Gaza.
The Chinese govt are underpining it for a reason and its not so the west can benefit from cheap clothes to help us out.
Results look poor to me overall but with a few positive bits of encouragement.
They missed the already downgraded revenue target albeit only just (by less than half a percent).
They did hit EBITDA guidance though - just sneaking in at the bottom of the range.
Cash flow was very disappointing (over £100m overall outflow) though part of that was the understandable increase in inventory in the US. It means a sharply increased net debt position and the mention of fixed assets to promote its balance strength is to me a hint of desperation. Overall they say FCF will be positive for 2025 (helped by reducing capex) but this weak promise suggests to me overall cash flow will remain negative as will profits.
Talking of profits, they made a huge overall loss of just under £138m not helped by chunky impairments. One bright spot though was that the RevB investment made a £3.1m contribution to profits. Also the focus on costs should help them get back on track in time.
Overall though the results look at the bad end of expectations and the expected recovery seems to be pushed further in to the future.
Good summary.
No reason to invest, some crumbs of hope to hold.
Await further downgrades.
"Overall they say FCF will be positive for 2025 (helped by reducing capex) but this weak promise suggests to me overall cash flow will remain negative as will profits."
It's not a weak promise. And how will overall cash flow remain negative if FREE Cash Flow is positive? GMV growth is expected as is EBITDA margin improvement. These ultimately contribute to FCF expansion. So it's not just capex reduction.
I think they're being prudent not to be over specific but positive FCF forecast is very different to the past FY and a sign of CONFIDENCE.
All IMHO DYOR
Happy
Don’t forget capital markets Day coming soooon!!
Difficult trading conditions! Just admit the competition are winning and yet Next and M&S can compete and grow. JL for me is done .
At least we've had a £20m wedding! Didn't he do well selling PLT to Boo share holders ! What's it worth now?
“It's not a weak promise. And how will overall cash flow remain negative if FREE Cash Flow is positive?”
It’s weak because there is no mention of any profit expectation for FY25 and a positive FCF should be a bare minimum. It seems a headline they’ve put in for people (like you) to latch on to and keep interested. And it worked. They could have said we expect negative overall cash flow for FY25 or another loss as their one headline but I suspect neither of those would have gone down so well?
The reason overall cash flow is likely to be negative is that FCF excludes share purchases, interest and lease payments.
So unless FCF is over around £40m then overall cash flow will probably be negative.
Results are awful. They're figures of a company that's shedding their core customers and clearly on the slide. They've had their day in the sun and it'd need miracles beyond their control to find those days again.
Happy - the thing is nobody knows what this coming year will do....
Hexam is a qualified accountcoughcoughant and business advisor mind...so.....
I am also a qualified accountant and also agree with Hexam's analysis here, although not to be disrespectful but understanding FCF is kind of investing 101.....
If you are a qualified accountant, explain to me how "overall cash flow" can be negative as Hexam said, if FCF is positive? I agree it is investing101 so this should be really easy for you to explain given your amazing credentials.
Broke - you are one step ahead of Hexam then😉.
The problem is understanding the numbers of today doesn't tell you where the business is going - thats a fact.
4 years ago the numbers didn't tell you boohoo were heading for losses, the same os losses today doesn't tell you boohoo isn't heading for big profits in the coming 4 years.
Companies swing fast either way.
Hexam is an arrogant person who just argues and insults people on any chat he frequents, literally claims to have done numbers and advised for companies then denies it. I can only assume it was one man band companies as no proper company would use an unqualified person to do their numbers.
Will we see some BOD buys ........ doubt it ..... the sunshine at the end of Mahmuds tunnel isn't that bright
Really??
650 incoming....
Happy - The normal indirect method of analysing cashflow on the cashflow statement is to take net income/(loss) then adjust for:
Operations
Investments
Financing
+/- some other comprehensive income/loss where appropriate.
In that order
FCF is purely the cash from operations and negates the financing and investing parts. It is a handy measure to measure the cashflow of the core business operations but can also obfuscate the full picture. The cash outflow on financing payments are my main concern here.
Broke - I am not a qualified accountant nor a company advisor as SCB keeps telling everybody. As you say understanding FCF is investing 101 so perhaps you’d like to answer Happy’s question - I already have but he seems to have ignored my answer.
'4 years ago the numbers didn't tell you boohoo were heading for losses, the same os losses today doesn't tell you boohoo isn't heading for big profits in the coming 4 years.'
SCB - I agree with you to a degree here, need to be an optimist to invest long in a business, but I also think it is fair to judge a business based on its current fundamentals. I think Hexam's comments that overall cashflow being negative is a fair one, especially when liquidity appears to becoming an issue here.
Oh come on Heaxm - you stated you have done the numbers for companies and advised them... None of which should be done without qualification (numbers) and experience (owning and running companies).
SCB
I don't think many of these posters really hold any shares or they wouldn't be blatantly misleading people.
Free Cash Flow is expected to be positive i.e. cash flow AFTER capex - clue being in the word "free". So anyone telling you "overall cash flow" is negative is doesn't know what they are talking about.
"Liquidity appears to be an issue" - erm no, it is not. They have over £200m cash on the balance sheet and while net debt is £100m, this should come down in FY2025 as FCF turns positive.
Sales performance in core 5 brands is improving rapidly. If this deteriorates again, they would have problems but the trend is positive. YOY core 5 brands in UK were flat.
All IMHO DYOR
Happy
“Oh come on Heaxm - you stated you have done the numbers for companies and advised them... None of which should be done without qualification (numbers) and experience (owning and running companies)”
I’ll try and make it simple for you - again.
I have prepared accounts and written commentaries on them.
I have not advised companies only the CEO etc of the companies I’ve worked for and prepared the accounts for.
I am not a qualified accountant nor have I ever owned (or run) a business but neither is necessary for what I have done.
It would be nice if you could challenge me on the content of what I have written rather than just throw out childish, petulant and irrelevant insults.
For example to you think overall cash flow will be positive in FY25 and why?
I thought my summary of the financials was balanced in the circumstances but if there was any element you think was unfair or wrong then let’s hear it?