Member Info for Peoplepower1

Also, I find reading an RNS at a later date helps me to learn on occasions something new from it or sometimes something I've missed comes to light or even a different take on what was said.

Vanilla - World Economic Forum 100 Technology Pioneers for 2020 is relevant to what's happening now and in the future with global technology. Have you read it? Have you read who the 100 Technology Pioneers for 2020 selected by the World Economic Form and what they're doing. If not, then I suggest you do. Two people appreciated it.

The copied RNS was a reminder to all of us what was said at the last trading update on 19 May 2020. 3 people liked the reminder. Obviously you didn't. Not everyone reads RNS, many forget what was said and many may be new here.

The Murata deal is the best thing that's happened to CAP-XX. CAP-XX have a great future. You're entitled to your opinion and I'm entitled to mine.

Maybe learn to be more open minded in future about posts. For me, there's always something new to learn.

A Reminder From the Financial Times

Mahmud Kamani and co-founder Carol Kane were shrewd enough to bring in outside help. Last year, they relinquished their co-chief executive roles and poached Primark’s chief operating officer, John Lyttle, to run the business.

They are also keeping open the possibility of a move to London’s main stock market, although they stress that “for now, Aim is the most appropriate market for Boohoo”.

Mr Lyttle knows about managing growth. During his time at Primark, annual sales more than tripled to £7.7bn. But his ambitions, and those of Mahmud Kamani and Carol Kane, go well beyond that. They have declared their intention to build the online equivalent of Zara or H & M.

Right now, few dare bet against them.

Mysticninja - there is no logic to this short. Simon Cawkwell's arguments are a load of twaddle, just like Shadowfall. Simon Cawkwell is another chancer who is doing his best to try to make investors nervous so they panic and sell and he makes loads of money out of them.

He's lost loads of money on shorts in the past and even on the shares he buys. Personally, I wouldn't listen to anything he says or does. He likes the sound of his own voice.

I have no problem with the £50m payout to John Lyttle, CEO for Boohoo. John Lyttle, Mahmud Kamani and Carol Kane are a great team and are looking to build Boohoo into a Zara. Zara's market cap is £86b, Boohoo's market cap is about £5bn. And they'll do it.

Simon Cawkwell aka Evil Knievil

For instance, I decided recently to short Tesla at $934, only to see it rise to close at $988. Tesla has cost me a lot of money this last few years and seems set to do so again. So, it seems will Boohoo too.

In the past Simon Cawkwell aka Evil Knievel caused controversy when he launched a $1 million legal claim against former Russian Deputy Prime Minister Boris Fedorov. Cawkwell's efforts were in response to moves to take control of the Russian oil and gas giant Gazprom.

Simon Cawkwell was forced to resign as a company director after he was found to have broken the rules of the AIM stock exchange by buying shares during a prohibited period.

Cawkwell is known to trade on the betting exchange Betfair, and prompted a long-running dispute with the firm when his wager that Niall Quinn would not become permanent manager of Sunderland AFC was lost.

Another one trying it on with Boohoo. Don't let his antics worry you at all.

The Market Cap of Zara owned by Inditex is nearly £86bn.

Mahmud Kamani and co-founder Carol Kane were shrewd enough to bring in outside help. Last year, they relinquished their co-chief executive roles and poached Primark’s chief operating officer, John Lyttle, to run the business.

They are also keeping open the possibility of a move to London’s main stock market, although they stress that “for now, Aim is the most appropriate market for Boohoo”.

Mr Lyttle knows about managing growth. During his time at Primark, annual sales more than tripled to £7.7bn. But his ambitions, and those of Mahmud Kamani and Carol Kane, go well beyond that. They have declared their intention to build the online equivalent of Zara or H & M.

Right now, few dare bet against them.

For me, 28 February 2022 revenue from each brand could be as follows:-

Boohoo brand including BoohooMan could rise from its last yearly revenue at 29 February 2020 of £600m to £1bn. Prettylittlething could rise from £500m to £1bn. Nasty Gal could rise from £100m to £400m. Karen Millen, Coast, Miss Pap, Oasis and Warehouse could have a total revenue of £1bn. Around £200m revenue for each of these 5 brands. Plus further revenue of £200m for any more brands bought. In total, revenue of £3.6bn by 28 February 2022 is certainly not impossible for Boohoo. This could mean a share price of at least £9 with a market cap of about £11bn.

Please check my maths to make sure I've got them right.

In my opinion, Boohoo will have more than nine brands by 28 February 2022.

In my opinion Boohoo could achieve revenue of £1.8bn by 28 February 2021. Boohoo has said 25% uplift to £1.2bn is achievable and that for me means it'll be probably be a 50% uplift which would be revenue of £1.8bn. I think Boohoo could then double that revenue to £3.6bn by 28 February 2022. This would mean a share price of at least £9 because the share price always reflects the potential future growth.

Amazon's Market Cap went from £200bn in 2015 to £1.3 trillion in 2020.

So, a £36bn market cap for Boohoo is tiny when you compare it to Amazon's market cap of £1.3 trillion. A £36bn market cap is less than 3% of a £1.3 trillion market cap.

Boohoo is more like a tech company even through it's an online retailer. Think of Boohoo as being the global go to place for clothes.

The market cap depends on the share price which depends on revenue. A £3.6bn market cap came about as a result of a £3 share price which was achieved with £1.2bn revenue.

To get to a £36bn market cap which is 10 times x the £3.6bn market cap would be a £30 share price which could be achieved with revenue of £12bn.

£12bn revenue for Boohoo is certainly not impossible. Boohoo has nine brands. It achieved £100m revenue with Nasty Gal in 2 years. It turned £100m revenue into £600m revenue for just the Boohoo brand alone in 5 years.

Achieving £12bn revenue for Boohoo is certainly not impossible. This would mean a £30 share price and a market cap of £36bn.

The global fashion market is worth £2,000bn. UK is £71bn, US is £330bn, Europe is £350bn and the rest of the world is £1250bn. Revenue of £12bn is less than 1% of the global fashion market. So it's definitely not impossible for Boohoo to achieve this and more.

https://www.weforum.org/agenda/2020/06/technology-pioneers-2020

Link to the World Economic Forum's Technology Pioneers of 2020

If you think that lockdowns have caused untold misery to every single consumer-facing business out there, you’d be wrong. Flying in the face of the coronavirus pandemic, the trading update on Wednesday 17 June 2020 from online fast-fashion firm Boohoo is the stuff of dreams for any company.

Trading in the three months to the end of May was described as “very strong.” So strong, in fact, the company hasn’t needed to take advantage of any government support, so far.

Of course, this isn’t a complete surprise. BOO did, after all, report surprisingly robust trading at the end of its previous financial year (ending 29 February 2020).

While lockdown inevitably weakened this momentum, today’s numbers point to a massive recovery in May. Group revenue for the first quarter came in at £367.8m — a stonking 45% higher than over the same period in 2019.

Encouragingly, growth has been seen across the main brands of Boohoo, PrettyLittleThing, and Nasty Gal. This was thanks, in part, to the company recognising that sales of loungewear and athleisure would be stronger during the lockdown and quickly adjust its marketing strategy.

Elsewhere, sales at relatively new additions, MissPap, Karen Millen and Coast, also appear to be very healthy. This goes some way to highlighting the company’s increasing aptitude for rescuing and revitalising troubled labels.

There were other positives. While the UK remains BOO’s biggest market, sales in other parts of the world are catching up fast. In the US, for example, revenue rocketed 79% to £92m.

While the coronavirus is clearly a global issue, the fact that trading overseas is so buoyant gives the company a good amount of earnings diversification.

Boohoo also announced the capture of Oasis and Warehouse for £5.25m after both chains collapsed in April. This follows management’s swift purchase of the final slice of PrettyLittleThing a few weeks ago, in response to an attack by short-sellers, Shadowfall.

Having raised nearly £200m from investors in May, the company now boasts more than £350m in net cash on its balance sheet.

This sizeable war chest should allow the AIM-listed star to continue buying brands on the cheap. And given the impact the coronavirus is likely to have on consumer behaviour going forward, there’s unlikely to be a shortage of candidates to choose from.

Boohoo’s goal is “to lead the fashion e-commerce market globally.” Based on its solid outlook, I think it stands a good chance of achieving this.

Growth in this financial year is now expected to be ahead of analysts’ current expectations, despite ongoing investment and consumer uncertainty. Revenue, for example, is now predicted to come in roughly 25% higher than last year.

While many high street retailers are struggling right now, Boohoo is going from strength to strength.

Just look at the company’s sales growth. Over the last three years, sales have risen by more than 300%.

Meanwhile, in a trading update earlier this week, the group reported revenue growth of 45% for the three months to 31 May (including growth of 83% in the US). Given that the quarter was in the middle of a global pandemic, that’s extremely impressive.

I expect sales and profits to continue growing at a rapid rate. This week, the company advised that for the current financial year ending 28 February 2021, it expects top-line growth of 25%, ahead of market expectations.

Further growth should continue to drive the share price higher.

Boohoo Group owns a number of brands that are extremely popular among the Millennial generation – who spend a high proportion of their disposable income on clothing – including Boohoo, PrettyLittleThing (of which it now owns 100%), Nasty Gal, and MissPap.

Its brands design and manufacture on-trend clothing that is highly affordable.

Its brands have a huge social media presence. For example, PrettyLittleThing currently has 12.4m Instagram followers while Boohoo has 6.6m. The company also now has a presence on TikTok.

Its brands have easy-to-use platforms that offer fast delivery.

The group has access to plenty of data on its customers.

It has no physical stores to eat into profit margins.

Ultimately, Boohoo is a retailer that is designed for the 21st century. With access to plenty of data, a strong social media presence, and no physical stores to drag down profits, it’s well placed to dominate in today’s digital world.

Revenue for the year ending 30 June 2020 is expected to be around 15% higher than the prior year at approximately A$3.7m (2019: A$3.2m).

The current sales order book for the underlying CAP-XX product lines is greater than twice the level at the same point last year.

The Board remains confident of winning a patent infringement case against Ioxus, Inc, but is now not forecasting any significant financial return from this action, as the Board understands that Ioxus has sold all of its assets.

Installation of the first shipment of the former Murata manufacturing assets is underway at CAP-XX's new Sydney manufacturing facility and the second and third shipments have left Murata and are in transit. Due to the COVID-19 pandemic, international shipping schedules have been greatly reduced and this has led to delays in the third and final shipment leaving Kobe port in Japan. The Board now believes that the completion of the transfer of Murata's manufacturing assets will be delayed by up to three months. The Board believes that the Company will be able to absorb the anticipated additional costs of this delay within its cash resources.

CAP-XX has now vacated its old premises at Lane Cove and has moved all equipment to the new manufacturing facility at Seven Hills, Sydney. The Company has also secured the necessary construction materials, despite difficult supply lines and the COVID-19 related work restrictions put in place by Government. The Company has made arrangements for remote engineering support to assist with the installation and commissioning of the former Murata production line while personal travel restrictions between Japan and Australia remain in place.

CAP-XX has acquired the outstanding finished stock of Murata supercapacitors, which was manufactured to facilitate the transition of Murata's customers to CAP-XX. Direct product sales from CAP-XX of the expanded product range have now commenced, supported by the launch of a new CAP-XX website. The Company has made good progress in engaging with all of Murata's customers and the Board is confident of the successful retention of customers.

Cash as of 8 May 2020 was A$4.4m. The Board also expects to receive a payment from the Australian Taxation Office of A$3.3m in the fourth calendar quarter of 2020. The Board is confident that the Company will have sufficient cash to complete the integration of the ex-Murata customers and the former Murata manufacturing assets, which the Board believes will result in a significant uplift in revenues and ultimately positive cashflow from operations in due course.

REMINDER

REVENUE FOR YEAR ENDING 30 JUNE 2020 IS EXPECTED TO BE AROUND 15% HIGHER

REVENUE IN SECOND HALF OF FINANCIAL YEAR HAS BEEN AFFECTED BY A DELAY IN SUPERCAPACITOR SHIPMENTS

ADJUSTED EBITDA FOR YEAR ENDING 30 JUNE 2020 IS EXPECTED TO BE A LOSS OF APPROXIMATELY A$2.0M

CURRENT SALES ORDER BOOK FOR UNDERLYING CAP-XX PRODUCT LINES IS GREATER THAN TWICE LEVEL AT SAME POINT LAST YEAR

In a note to investors titled "Smashing expectations", stockbroker Jefferies praised the new trading figures and said: "We see the acquisition of Oasis and Warehouse as a low risk and likely high returning opportunity, one that provides further evidence of the long-term potential in boohoo's multi-brand platform."

Analyst Andrew Wade and Daniela Almeida wrote that Boohoo's figures for the first quarter of the year had been well ahead of the City's forecasts, in part because of restrained language from management at the last set of results in April.

Analysts at Liberum said Boohoo now looks like 'the pre-eminent leader in womenswear in the UK now operating with a stable of nine brands.'

AJ Bell's investment director Russ Mould, said: 'Any scepticism over demand for its clothes in lockdown, on the premise that its targeted demographic no longer needs to dress up to go out, looks unfounded after a stunning surge in sales.

'The company seems to have adapted to new realities – pitching loungewear and athleisure gear at its customer base to great effect.

'Clearly online retailers have been in a very strong position, with shops having been closed due to lockdown there has basically been nowhere else for people to go.

'Adding insult to injury for physical retail, Boohoo continues to hoover up once proud high street names at knock-down prices.

'Oasis and Warehouse are the latest brands added to the stable for what in relative terms is small change.

'The company still has plenty of cash for bolt-on acquisitions that it can feed into its central operating platform.

Jefferies analyst Andrew Wade said Boohoo's sales model had been validated by its recent performance. He said: 'The result clearly demonstrates the virtues of Boohoo's nimble model – leveraging its flexible supply chain, and rapidly evolving both marketing content and product ranges to drive superior growth.'

Meanwhile, David Madden, an analyst at CMC Markets UK, said he thinks Boohoo's share price will continue to rise. He said: 'Boohoo's share price is likely to keep pushing higher on the back of the company's strong first quarter results.'

On the purchase of Oasis and Warehouse's online operations, Graham Spooner, an analyst at The Share Centre, said: 'The deal to buy Oasis and Warehouse, two well-known high street names, highlights the Group's strategy of taking brands with poor sales from the high street and transferring them onto its sophisticated internet platform, including its supply chain and infrastructure.

'Overall, the Group continues to maintain a good market position among younger consumers, a good growth track record with plenty of potential to increase market share over the coming months.'