Member Info for unhooked

This has been a good discussion actually, the extent cash has derived from operations, the credit facility, the de-stocking, or wherever. When you're not bickering (you know who you are), you're all quite knowledgable actually. We need the full accounts to get this answered.

Trading, you're misunderstanding pricing power (the ability to raise prices without a commensurate hit to demand) and market power or influence.

I actually don't know what you mean when you say "Wrt price elasticity, basket value has grown with very little fall in product purchase". Do you mean basket value has risen but the quantity and mix of goods in the basket hasn't changed much? If so, that means Boohoo have been successful at raising prices without lowering demand. Which means Boohoo enjoys a low price elasticity of demand for their products - they can raise prices without demand falling, such that an average basket is more valuable. Tbh, that would surprise me in such a competitive industry anyway, but there may be some value in their IP (their brands) to back that up.

Doesn't matter that I read economics at uni (albeit 40 years ago), I kind of knew you wouldn't agree with me if that meant admitting to getting something wrong.

Anyway, you're all over the place with these terms "price elasticity of demand" (which is not "strong" btw, it's either "high" or "low") and "pricing power" (which is the ability to raise prices without hurting demand, not the ability to influence other suppliers prices) you should look them up.

Sorry, busy on the phone. Ok, I think I see what I didn't understand.

You think that "pricing power is the ability to affect the price charged across a whole industry". No, it's not. Pricing power is the ability of a company to raise prices without negatively affecting demand for its products. Pricing power that affects the price charged across a whole industry is something else. Maybe market influence? I'm not sure.

The other thing is, when you talk about "price elasticity", what you are are really referring to is price elasticity of demand, which is the responsiveness of demand to a change in price. Companies with "strong price elasticity" as you put it (meaning. high price elasticity of demand) are companies in very competitive industries, like Boohoo, that for instance would see demand for their products reduce markedly if they try to raise prices. Such companies have no "pricing power".

So when you say "it exhibits very strong price elasticity, which is far more important than pricing power", you are really saying "it exhibits no pricing power, which is far more important than pricing power", which makes no sense.

Hope I'm making sense.

Trading, could you explain what you mean by "it exhibits very strong price elasticity, which is far more important than pricing power"?

"What a contrast. A day after its big rival ASOS PLC (LSE:ASC) lost around a fifth of its value on funding worries, Boohoo Group PLC (AIM:BOO) served up better-than-expected results, sending its shares 13% higher.

The news even prompted Shore Capital, the regional broker that has guru status in the world of online fashion, to move off the fence and upgrade its stock recommendation to ‘buy’.

“Despite a recent decline in Boohoo's market share, the upcoming fiscal year offers favourable year-on-year comparisons, along with a streamlined inventory and the phased launch of a US warehouse, which are expected to boost the company's prospects,” said Shore.

It puts the fair value of the shares at 54p. In early trade, the stock was changing hands for 43.40p, up 4.95p.

Earlier, Boohoo's prelims lifted investors' spirits by being not quite as bad as forecast - in other words, the bar was low, folks.

Adjusted earnings were down 49% at £63mln and revenues were off 11% at £1.77bn.

The cash generation element of the results was the bit that surprised on the upside, as the City's analysts like to say.

The net cash position as of February 28 was £6mln against forecasts that it would be carrying debt of around £60mln.

So, here’s the thing: While ASOS appears to be struggling to keep a lid on its indebtedness, Boohoo is having no such problems."

Proactive Investors, this morning.

Nice link Troajan. Shore Capital are now recommending "buy" - that's quite a turnaround from them...

They're not good results. But the biggie is the better than expected cash position, despite all the investment. Some were actually talking about Boohoo seeking a capital raise. I think we can put that one to bed.

Phew!

"Relief rally".

I think so. And Bought a few - my 1st purchase of Asos.

Am already heavily in the sector via Boohoo and, from what I've observed here, am expecting plenty of pain tomorrow on Boohoo's Results day.

This sector is hated beyond belief.

Yup, Asos has just broken £4 this afternoon. I wasn't a holder there, but I am now! "Punt-sized" position.

Incredible! Just got quoted 397p to buy...

His language (all cheers mate), not to mention the content, tells you he's totally one of MM's poodles. Independent director, my *ss!

... might be the question. Results tomorrow?

Lords White and Hanson were asset-strippers, no more or less. Not convinced UK plc wants or needs their like.

Thanks moniman. Fair to say Mr Scott's not a fan of THG then! Describes it as an "awful company" and MM as "delusional" lol. Leaves the door open re a possible turnaround story though.

I hope so because these quarterly results read as mildly disappointing, esp the cash position. Nonetheless, I continue to see this as a well-managed company doing all the right things and with the medium-term potential of the Bilboes mine. Diamond hands here.

That Bloomberg piece was right in hindsight.

"also given the number of employees with shares there will be a secondary market if fair price not paid". Very good point.

Hope you're right about the moral high ground Rock, you may be, because if he can get to 75% voting for taking it private, then remaining PI shareholders could be well and truly shafted, a la iEnergizer.

"they will have to pay fair value to the hard core rump who do not blink during stakebuilding exercise". But isn't that a dangerous game Cantona. If he can get to the magical 75%, he can announce a vote to take it private and PIs could be left high and dry. I'm thinking what happened to iEnergizer - PIs were shafted as the share price collapsed as investors scrambled for the exit, not wanting to hold a hard-to-trade share.