Member Info for Slipperman55

Annual Report

The German hotel market is 40% larger than the UK and shares a number of attractive structural characteristics that

helped drive Premier Inn’s success in the UK. Having grown rapidly in recent years, we are on course to become Germany’s number one hotel brand, delivering profitable growth and attractive long-term returns on capital.

Payment date 6/2 and ex date 31/10.

https://www.whitbread.co.uk/investors/share-price/dividend/

Well done to anyone who jumped in at the 130s level. Sadly, not me

I think this is the key passage (below)... The budget adding £23m of labour costs is brutal. Saying that the effect of the budget is unclear = impact not great. I don't see anything that points to decisions to improve things other than be very disciplined and increase auto center costs. . Good effort to get debt down. Hard to pick which ay share price will go,,,

As a business employing more than 12,000 colleagues, measures announced in the UK Budget add c.£23m of direct labour cost, of which c.£9m was already included in FY26 planning assumptions and fully mitigated. The effect of the UK Budget on consumer behaviour and hence the trajectory of our end-markets is unclear. We have a greater ability to mitigate headwinds in the more needs-based Autocentres servicing business, where pricing power is greater. Additional tactical and structural options to support mitigation are under review.

Will there be good news or bad news? If there is bad news, will they have a plan? Bad news and no plan is pretty much what analysts are seeing which is why the SP continues to fall. Do they have any substantive options? Probably but are they palatable? Possibly splitting the business and carving off retail.

They have some pretty big overheads care of the retail business. If the retail business continues to struggle they have some big decisions to make. My guess is that the board would prefer to reduce retail significantly and focus on servicing. By now they had hoped that web based sales would have grown much more. The Tory Govt couldn't fund social care for the elderly so said to local authorities, you keep business rates but expect to get less money from central govt. Local authorities are running out of money so don't expect business rates to fall. NI cost increases don't help. Is there any economies of scale in servicing? Some, but not enough and its a super very competitive industry. That means that customers and staff can easily switch. Halfords are stuck in a two low margin businesses with too much debt and falling margins. Issuing shares to buy market share isn't going to work anymore. If they slash and burn do they have good quality earnings to reduce debt , possibly. Right now they have limited options and need a booming UK economy to get them out of trouble. My guess is they will merge with someone.

New car sales are about 18% electric and current cars in total about 8%, but long term the outlook for the industry is to die. Possibly 15-20 years of income, probably less. Current levels of competition in servicing point to falling margins. Current retail offering will struggle against online. UK govt policies not helping - NI & rates. Can they be a market leader in a doomed industry , possibly but they need to stop overpaying via expensive rounds of new equity. Current management team not good enough.

A few thoughts on Halfords in the run up to their interims. 1) Did they pay too much for their acquisitions? 2) Why can't they get their act together on bikes? They require a big footprint and they are fourth tier on bike retail and maintenance. Assume no other current ideas for retail footprint, so soldier on. 3) General online portal is better, but lots of competition. Is it good enough? 4) They aren't getting any help on business rates or national insurance. So hard to be optimistic. 5) Other than cost cutting and trying to grow non- retail servicing, are they doing enough or just waiting for a stronger economy? 6) No changes in key personnel, is this credible? It can't be.

Tell me you are kidding! They got $US5 bn at a pre-covid price b4 asset values in the coffee retail sector collapsed due to higher costs (labor, rent, etc) and falling demand. Current market value of Costa about 20% of 2019 value. One mistake was bigger than needed share during COVID but who would blame them.

The Northgate deal wasn't a bid it was a merger. Given that Northgate market cap is now much higher and Halfords much lower, one would have thought that the terms are worse.

Retail inventories cut back and profits own by almost 50%. It's a tough market out there. Will get get better?

There is a possibility that sales will show signs of stalling. I say this because as inflation drops the like for like numbers will inevitably stall. If the outlook is negative one might expect that they will have a package of remedies. They will also be waiting on new policies when Keir takes up the reins. There will be falls in interest rates in the next quarter and this will def help optimism. I can't see any obvious reasons why the trading update will be dramatic either way. Can they maintain divs and does this matter? Labour have muttered that bus rates might fall, but I'm not so sure and don't know what impact this would have. Any change is unlikely to favour big operators. Labour costs will continue to be an issue, which isn't going to get better.

The market is pretty pessimistic on Halfords, rightly so. This is a company that needs a new team. Waiting for a buyout or merger with another company looks hopelessly optimistic.

So Graham Stapleton and his mobile phone chums have been running Halfords for six years. Any thoughts on how well he is doing and if he is earning his £1m comp package? I wonder what long term investors think.

"Redde tables at 1.4 billion pound bid which the Halfords board said significantly undervalued their company".

You are using the merged market cap of two companies (Halfords and Redde) to extrapolate a value for one of them (Halfords). Halfords has a market cap of £343m because that's what the market currently thinks it is worth. Note that HFD's market cap is less than 1/2 what it was 2 years ago. If you have low and falling margins in a tough sector this is what you get. Valuing a company on a possible future takeover is like buying lottery tickets and holing your breath.

Halfords has fallen over every main time period. 1d, 5d, 1m, 6m, ytd, 1y, 5y, and since 2004. Is it possible that they need a different management team?

Now in 10 th most shorted stock.

In six years Graham Stapleton has been paid received something like £6m plus of salary, share options etc. He recruited his cronies from previous roles, and in that time the share price has been on a downward trajectory and underperformed against any reasonable benchmark. He has issued stock at high prices and continued to acquire new business and is now working out what to do. The market speaks.

At this rate is will be in the list of the top 10 shorted stocks. I'm surprised the Chair and CEO and making new appointments. The div cover and op margin have halved. Scary stuff.

If you take the 12 most shorted stocks in the UK half of them are retailers of some form.