The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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https://www.theworks.co.uk/page/world-book-day.html
"We're passionate about giving every child the opportunity to read and that's why we are proud to be taking part in World Book Day for the first time ever!
Bring your voucher into stores between 16th February - 26th March and exchange for a free book from a variety of titles from our World Book Day range or get £1 off any books priced £2.99 or over"
(The voucher is funded by the 'World Book Day' charity.)
https://vimeo.com/797369311/3d01e86474
Profit protection means theft reduction. Dave Purdoe previously worked in the same role for Card Factory, joined The Works in December 2021. He is the only person working in profit protection, as the previous profit protection team was let go during the administration of 2008.
Some quotes:
On his role:
"I know from the Card Factory model and people listening to this will know full well some of the like for like that post well crafted interventions of an investigative nature I think will just blow us away. I will be personally disappointed in next 12 months if there's not a discernible difference on the balance sheet because of activity my function is driving. Somewhere, there'll be a set of financial accounts at Card Factory that actually said, you know, something's changed in the financials and we can only put it down for the approach the world in investigation and for me that you know, you going on telling stakeholders and shareholders out. That's a fantastic accolade. That's something that I want to repeat with The Works."
On trading:
"The store elements of the estate's traded really well had a decent Christmas to be honest. I'll break that down. So we've got some locations that probably given our time again, we wouldn't have opened but I think there's plenty of multisite retailers in that particular position. We've opened some cracking new locations and you walk in and are blown away like Leeds White Rose. It just looks fantastic and it's something that you've got a real pride in and your put your name by and walk around because you're proud to be part of that. So we've got locations that are performing fantastically. Like every multisite retailer we still have a number of locations that haven't come back post covid and I don't know what the future will be as regards where performance will lie with them.
The online piece still is not up to where it should be now, whether there's a naiveitate to imagine that lockdown online type frantic activity would continue once our freedom was given back to us. They don't know but it's certainly not where it needs to be. If that can come into line and I'm confident it will come into line it'll just be an amazing business. It really will be because as I said, we've got stores that just absolutely smash it.
Some of the the products we've been knocking out now and you know, we're getting branded Publishers who are coming to us now saying look got a book launch. Do you want to be involved or throw some markers in some PR your way. Historically that was like we're not we're not going to a discounter so we'll sell it anywhere else on the high streets at full price before we come to you. Complete change."
What's with the tiny buys?
Sold off cheap will still be a lot higher than current share price
Graeme Coulthard increases his stake to 5.6%. Coulthard is a former director of Card Factory and was also active during the Private Equity takeover of AA, when it was sold off on the cheap in 2021. I fear we may see the same thing here.
https://www.investegate.co.uk/Index.aspx?searchtype=1&words=Graeme+coulthard
Good comparisons Pandafund.
That cyber attack looks to have been worse than all other years for H1.
If things get back to normal then I reckon these are very cheap.
Same figures hopefully formatted better:
Year | H1 | FY | H2 (FY-H1)
2023 | -6.4 | 9 | 15.4 (Cyber att Q1)
2022 | 2.5 | 16.6 | 14.1
2021 | 1.5 | 4.3 | 2.8 (COVID)
2020 | -4.3 | 10.8 | 15.1
2019 | -0.9 | 13.9 | 14.8
2018 | -0.2 | 13.2 | 13.4
By my calculations, The Works is forecasting the highest ever H2 EBITDA:
| H1 | FY | H2 (FY-H1)
2023 (Cyber att Q1) | -6.4 | 9 | 15.4
2022 | 2.5 | 16.6 | 14.1
2021 (COVID) | 1.5 | 4.3 | 2.8
2020 | -4.3 | 10.8 | 15.1
2019 | -0.9 | 13.9 | 14.8
2018 | -0.2 | 13.2 | 13.4
I was surprised by the drop on Friday - did people forget about the cyber attack in Q1???
The cyber attack led to:
- five stores being closed for a period
- store deliveries being paused
- online deliveries being paused
- in-store and online sales being deliberately throttled for a number of MONTHS afterwards whilst the EPS was updated.
Sources:
https://www.bbc.co.uk/news/business-60993635
https://corporate.theworks.co.uk/application/files/9616/6478/3372/TheWorks.co.uk_plc_Annual_Report_and_Accounts_2022.pdf -"the cautious approach taken to the recovery affected sales in April (and into the beginning of FY23)"
The only new information in the RNS was that Christmas trading was good, and that the full year EBITDA expectation of £9m remained - including the caveat that the £9m included a possible downturn in Q4 trading which may never materialise (leading to a higher EBITDA).
I thought businesses were getting more help with costs but what has screwed them is an extra £3.9m in business rates. Looks like the government is making sure it gets its money back what it paid out in 2020/21.
Steve,
Fully agree. With lots of general retail uncertainty and wage inflation and energy cost rises, I am not convinced the stated EBITDA will be achieved and as such the final dividend may be under pressure. I was positive re WRKS but not now and very much wait and see for me……
Unless there is a sentiment change in buying the works I think the share will be stagnant until we read the full years results in May? I should of looked into it better but I thought the results today included some Christmas trading but it seems that will be made available in May.
Did anyone listen to the Presentation? If so, any mention of cash as at 15th Jan.
The £7m as at 30th Oct 22 was, in effect, only £2m as £5m of payments went out 31st Oct 22. Obviously, for balance, cash tied up in stock ready for Xmas trading etc. So cash position now would be useful....
Wow that has surprised me, for the last few weeks I have been thinbking of buying more of these as I thought they had turned the corner and the results would be good.
I decided to wait and glad I didn't buy now and it looks like I made the right call this time.
Looking through the RNS it's hard to see where they will make good profits in the second half with consumer cut backs, socan see the SP going down to 30p ish.
Steve,
Last years H2 profit was 11.2 (H1 -1.0) so full year 10.2.
If this year H2 is similar at 11.2 then full year would only be 0.6m (H1 -10.7). On that basis, I personally cannot see a final dividend being declared. What am I missing ?
Steve,
Yes, I stated that. But is the final divi under serious threat? Personally, struggling to see much if any full year profit and as such final divi could be under threat.
Or a Mai missing something. With 10.7 first half loss, what are you expecting for full year profit?
They have stated no interim dividend.
Hi,
With a half year loss before tax of £10.7m, surely they will (even taking account of second half weighting) struggle to make a full year profit after tax? If so, surely there is significant risk that there will be no final dividend as well as no interim dividend?
Thoughts?
Just checked and it’s negotiated order to sell. Oh well down we go.
I regretted topping up at 46p last week but after that rns it was a very silly top up, but I thought the same as you and expected great news.
Yes I think you are right and I was wrong. There are some good points in the RNS the cash at bank is still decent and Christmas sales were good, but overall it is disappointing.
I think after reading the rns the sellers have made the correct decision, A bigger loss than last year and reduced online sales is going to hurt this today?
Any sellers today are going to be way out of pocket, the results are going to be very good. The shops have done very well. I have watched the shops regularly every day during the Christmas period and the goods were going big time. I was going to post a message during business hours, but I thought no I will let them sell their shares and face the money they might made happy days to the shareholders. Harry
Due Friday, Let’s hope this pushes the share price up with hopefully news on excellent trading over the Christmas period?
This thread is nice and quiet which is often a good sign. It is also clear from the TR-1s that some people are accumulating.
I am very hopeful here for Friday and beyond.