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I agree Anacott. He was completely wrong on inflation the first time around and I do think same as you that he’s now desperate to correct the mistake
I do think we should see where inflation settles from these current rate rises. Ultimately next year inflation will have to leap frog these higher figures so that should optically help
Weren’t
The rate rise is as expected I think it’s the more aggressive outlook people were expecting
The sale data I track on the app looks really good!
Why is the US distribution centre a game changer? Do you know what margin Asos makes on its American business?
Goood news and thanks for sharing
Your maths on earnings isn’t correct
I saw a paper from Numis yesterday with 80% of sponsors all targeting U.K. P2P
The consensus was also that debt markets would normalise
No guarantees of course but those guys have cash to spend
@hereshopin doesn’t a material contract win change things?
No one has a crystal ball you know
We are told here that ingenuity commerce would be £108m revenue. Is it the same busines and value now it will be £60m? By your logic the answer is yes
Ocados revenues are different to THG nutrition and beauty. Only commerce is similar to Ocado and that c.£60m this year
So compare £2.5bln to £60m
Selling a few frozen meals via a license isn’t the same as what Ocado are doing
I mean come on
The reason I say what I said about it would have been better for QIA to have bought the lot id Moulding isn’t writing a buy out cheque. He doesn’t have the cash
You want QIA to have as low an average as possible so the bid they have to make (if they do) on an average looks acceptable
That’s why it would have been juicier if QIA bought them all
I’m also not too sure on Qatar. The £ amount they bought was peanuts. If they had taken the whole lot I’d have been more curious
Licker great points
To add
- how did you factor the £30m cost savings? Or assume that that cost just goes into marketing for beauty?
- I don’t think MyProtein can lift prices anymore. A lot of heat on forums is how MyProtein prices have gone too near the more premium brands. I would rather take the 200pts GM and then go for market share
- I think your av staff wage is high (maybe £35k is more sensible) but shopify cut 1,000 staff earlier this year. Maybe the reason we didn’t get an analyst call was that this is being planned?
Licker I think FY23 is a fair year to use as I think growth will be limited so you won’t get investors looking through to FY24 with a limited organic run rate
But I take your point on margin and using that to look ahead
https://www.retailgazette.co.uk/blog/2022/10/asos-axe-jobs/
Cutting headcount
Has 3,800 employees. THG has nearly 10,000!
Really got to think there could be some fat to cut
1,000 at £35k would be £35m straight to profit and cash
No chance 10x
Modelez paid near 40 for Grenade bars
THG have to just sort this cash position out. Either ingenuity steps up or we start looking at cutting some costs
With the “new” ingenuity plan (it’s not new we’ve always gone for whales) there should be some sales heads to lose if not doing enterprise sales anymore
I’d like to see an SME product
Issue with taking the Ingenuity line and not the commerce line is
1) lower margin
2) includes 15% 0 margin fulfilment revenues
It’s commerce that we need to grow as that’s the high margin element
Oke I think Steve is right the margin benefit comes in Q4. The commentary was that it would add 200 basis points over next year so you can do the math on that
Steve I agree you’re right. I think beauty will be flat next year. Mid-teens isn’t happening but I’d love to be wrong
Ingenuity who knows but we need some more info on the pipeline. The guidance given last year is obviously going to be missed but we never got updated guidance
Big one coming up is Optimum Nutrition which I think is next week. I posted Bellring who noted a HUGE fall in volume in their muscle/ gym brand - revenue was flat due to price increases
On the smaller UK side
Huel - filed accounts to Jul-21
Revenue - £102m
GM% - 62%
EBITDA - c.£2m
Bulk - filed accounts to Dec-21
Revenue - £67m (down £10m on FY20)
GM% - 36% (shocking)
EBITDA - £2.5m
Protein Works - filed accounts to Aug-21
Revenue - £25m (up from £17m)
GM% - 47% (inline with MyProtein)
EBITDA - c.£1.9m
What's interesting is how poor Bulks GM% is. From the strategic report they blame this mostly on exporting to the EU. For THG this is partly mitigated as we can export within EU
Bulk also have their manufacturing site in Poland, in exactly the same town! So they are clearly trying to cover the MyProtein model but are falling short somewhere. They also had a poor revenue performance (down 14% when MyProtein grew 17% - less acquisitions)
I thought this was interesting as it highlights the number of small and subscale competitors which MyProtein should easily win against (once we have sorted out Ingenuity paying for itself)