Tuesday, January 18, 2011

Share Price Alert: Freightways Ltd



I don't pay much attention to this company share price wise. Freightways Ltd [FRE.NZX] has been the 3rd largest stock in terms of purchase price in the Share Investor Portfolio and I have simply held for the last 6 -7 years and collected the healthy dividends.

The share price reached lows of just above $2.60 mid 2010 (see 3 year chart below) and plumbed those depths once at the end of 2008 and then again midish 2009.




The share reached an all time high of just over $4.75 at the beginning of 2007 (see 5 year chart below) and since then has been up and down more regularly than Charlie Sheen in a Hollywood whorehouse.



Over the last 2 months though (see 3 month chart at top of post) the stock has added 39 cents to close at $3.29 today. This is an increase of about 14% and the share price has broken through a barrier of around $3.25 last attained in May 2010.

Either there is good news coming up in the coming 2011 Half Year profit announcement to be made in mid February or the market thinks the company is onto a better thing as people are perceiving the economy is going to do better in 2011.

If you have been looking at buying it might be wise to wait until after the result because I don't see that the company would have done well enough to justify such an improvement in share price.

Look for weakness post Feb.


Share Price Alert

Xero Ltd


Freightways @ Share Investor


Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering

Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports



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c Share Investor 2011

Monday, January 17, 2011

The Warehouse Group: Should Ian Morrice Go?

Update - Hours after this piece was published it was announced that Ian is retiring this year and the company is looking for his replacement.


Speculation in mainstream business media over whether The Warehouse Group [WHS.NZX] boss Ian Morrice and some of his executives jobs are on the line because of sliding sales and sinking profits have got me thinking as to whether sacking of Morrice would be a rational decision based on his results as CEO of the company since he took over the reigns in 2004.

Lets have a look at the last 5 years of company performance then and make our decision based on his record of financial results.

Some key figures from a Research Report dated 16.1.11

Sales have dropped from almost 1.9 billion in 2006 to less that 1.7 billion in 2010. Net profit (before abnormals) from $69 million to $83 million. Return on assets, from 9.5 - 13%. Net margin from 3.14 to 4.93%.

To be fair Ian took over the company at a low ebb as the company was wallowing in debt due to a failed entry into Australia in 2001 and an exit from that market in 2005. This was a reason for the poor financial results around 2004-2005 when Ian took the reigns.

Therefore it makes subsequent years look good by comparison and this should be taken into account when assessing Ian's impact on the business.

There was also his failed move into the grocery sector with the Extra format that was trialled and cut a few years latter at a cost of at least 20 million dollars.

In the last few years the company has taken a big hit and Ian has placed the blame on various outside influences such as inclement weather, a change in customer demand or the recession.

It really doesn't look that good at all for his position when you look closely at the figures combined with his efforts to expand the business over his 6 year tenure.

He has basically failed to deliver what he was hired for - to turn around the business after the disastrous foray into Australia.

In an interview I had with him at the end of 2010 Ian seem to think he had done well over the last 6 years:

SI - What has been your main achievement or achievements at The Warehouse over the last six years as CEO ?

IM - In financial terms: NPAT growth + 40%, debt reduced from over $300m to under $100m whilst returning over $500m to shareholders. I am also pleased to have enhanced our strong brand reputation - 90% of the population still shop with us every year. I am proud of the many leaders who have developed their careers in the business over this time - our talent retention levels are over 90%. We have improved and modernised every aspect of the business over the past six years from source to shelf and transformed our supply chain internationally and domestically enabling significant cost reduction.

But we are yet to see an impact of Ian's input on the bottomline to date and we are unlikely to see that in 2011 either, in fact the status quo of dropping sales and profit will be de rigguer unless some changes are made and that should be made at the top in my opinion.


Disclosure: I own WHS shares in the Share Investor Portfolio


Warehouse Group Ltd: 2010 Full Year Profit Analysis
Share Investor Q & A: Questions to The Warehouse' Ian Morrice
Long Term View: The Warehouse Group Ltd
Share Investor Short: Warehouse Group yield worth a look
The Warehouse Group: 2010 Interim Profit Review
The Warehouse: Big Brands, Big Opportunities
Warehouse strike opportunity to buy
Long Term Play: The Warehouse Group
Share Investor Short: Warehouse Group yield worth a second look
Woolworths supermarket consolidation an indicator of a move on the Warehouse?
Stock of the Week: The Warehouse Group
Warehouse 2009 interim profit a key economic indicator
When will The Warehouse bidders make their move?
Long vs Short: The Warehouse Group
Warehouse bidders ready to lay money down
The Warehouse set to cut lose "extra" impediment
The Warehouse sale could hinge on "Extra" decision
The case for The Warehouse without a buyer
Foodstuffs take their foot off the gas
Woolworths seek leave to appeal to Supreme Court
Warehouse appeal decision imminent
Warehouse decision a loser for all
Warehouse Court of appeal decision in Commerce Commission's favour
MARKETWATCH: The Warehouse
The Warehouse takeover saga continues
Why did you buy that stock? [The Warehouse]
History of Warehouse takeover players suggest a long winding road
Court of Appeal delays Warehouse bid
The Warehouse set for turbulent 2008
The Warehouse Court of Appeal case lay in "Extras" hands
WHS Court of Appeal case could be dismissed next week
Commerce Commission impacts on the Warehouse bottom line
The Warehouse in play
Outcomes of Commerce Commission decision
The fight for control begins soon

Discuss WHS @ Share Investor Forum - Register free
Download WHS company reports

Shop online at The Warehouse

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NEW - From Fishpond.co.nz |
Think Bigger, By Michael Hill

c Share Investor 2011

Share Investor Portfolio: Value @ 17 January 2011

The good start to the year for the Share Investor Portfolio continues. The Portfolio is up 1.16% or $3240.03 on the Jan 10 update . For the first 2 weeks of 2011 the portfolio has increased by 2.22% or $6173.76. This weeks rise was due, for the first time since we started looking at the portfolio back in October 2010, to every other stock rising bar SKC, the biggest part of the portfolio. That stock in fact dropped y 6c over the week. FRE contributed the biggest gain at 15c per share while the WHS, MFT and even MHI evened out the losses from SKC. Only a few stragglers failed to gain.

The total of unspent dividends in the bank from the 2010 earnings year is $16631.93 at close of reporting season for 2010. There are also approx $50000.00 in tax credits earned from the portfolio since it began in late 2002.


Share Investor Portfolio as at 17:30:00, Friday 14 January, 2011 (NZDT)

Stock
Quantity
Cost price
Total cost
Market price
Market value
Change
%
AIA

2,000 $1.700 $3,400.00 $2.260 $4,520.00 $1,120.00 32.94%
AIA

2,000 $1.510 $3,020.00 $2.260 $4,520.00 $1,500.00 49.67%
AIA

803 $2.150 $1,726.45 $2.260 $1,814.78 $88.33 5.12%
AIA

445 $0.000 $0.00 $2.260 $1,005.70 $1,005.70
AIA

64 $1.650 $105.60 $2.260 $144.64 $39.04 36.97%
ASBPB

2,946 $0.000 $0.00 $0.725 $2,135.85 $2,135.85
ASBPB

7,054 $1.000 $7,054.00 $0.725 $5,114.15 $1,939.85 27.50%
BGR

438 $0.000 $0.00 $1.400 $613.20 $613.20
BGR

2,562 $0.990 $2,536.38 $1.400 $3,586.80 $1,050.42 41.41%
FBU

266 $0.000 $0.00 $7.940 $2,112.04 $2,112.04
FBU

848 $9.750 $8,268.00 $7.940 $6,733.12 $1,534.88 18.56%
FPH

3,000 $2.350 $7,050.00 $3.140 $9,420.00 $2,370.00 33.62%
FPH

541 $0.000 $0.00 $3.140 $1,698.74 $1,698.74
FPH

1,459 $3.720 $5,427.48 $3.140 $4,581.26 $846.22 15.59%
FRE

1,882 $0.000 $0.00 $3.250 $6,116.50 $6,116.50
FRE

6,749 $3.630 $24,498.87 $3.250 $21,934.25 $2,564.62 10.47%
GFF

541 $0.000 $0.00 $1.730 $935.93 $935.93
GFF

1,459 $2.330 $3,399.47 $1.730 $2,524.07 $875.40 25.75%
HLG

244 $0.000 $0.00 $4.120 $1,005.28 $1,005.28
HLG

756 $2.530 $1,912.68 $4.120 $3,114.72 $1,202.04 62.85%
KIP

190 $0.000 $0.00 $1.000 $190.00 $190.00
KIP

810 $1.480 $1,198.80 $1.000 $810.00 $388.80 32.43%
MFT

1,000 $7.960 $7,960.00 $8.000 $8,000.00 $40.00 0.50%
MFT

1,838 $8.000 $14,704.00 $8.000 $14,704.00 $0.00 0.00%
MFT

657 $0.000 $0.00 $8.000 $5,256.00 $5,256.00
MFT

1,505 $4.200 $6,321.00 $8.000 $12,040.00 $5,719.00 90.48%
MHI

1,646 $0.860 $1,415.56 $0.910 $1,497.86 $82.30 5.81%
MHI

7,000 $0.630 $4,410.00 $0.910 $6,370.00 $1,960.00 44.44%
MHI

718 $0.000 $0.00 $0.910 $653.38 $653.38
MHI

636 $1.050 $667.80 $0.910 $578.76 $89.04 13.33%
PPG

31 $0.000 $0.00 $0.270 $8.37 $8.37
PPG

1,500 $0.440 $660.00 $0.270 $405.00 $255.00 38.64%
PPG

1,004 $0.800 $803.20 $0.270 $271.08 $532.12 66.25%
PPL

1,000 $3.090 $3,090.00 $1.750 $1,750.00 $1,340.00 43.37%
PPL

1,000 $2.870 $2,870.00 $1.750 $1,750.00 $1,120.00 39.02%
PPL

939 $4.200 $3,943.80 $1.750 $1,643.25 $2,300.55 58.33%
PPL

877 $0.000 $0.00 $1.750 $1,534.75 $1,534.75
PPL

1,184 $1.530 $1,811.52 $1.750 $2,072.00 $260.48 14.38%
RYM

459 $0.000 $0.00 $2.370 $1,087.83 $1,087.83
RYM

4,586 $1.970 $9,034.42 $2.370 $10,868.82 $1,834.40 20.30%
SKC

5,750 $7.430 $42,722.50 $3.280 $18,860.00 $23,862.50 55.85%
SKC

1,000 $7.600 $7,600.00 $3.280 $3,280.00 $4,320.00 56.84%
SKC

2,750 $7.700 $21,175.00 $3.280 $9,020.00 $12,155.00 57.40%
SKC

1,431 $8.750 $12,521.25 $3.280 $4,693.68 $7,827.57 62.51%
SKC

25,085 $0.000 $0.00 $3.280 $82,278.80 $82,278.80
SKC

899 $4.720 $4,243.28 $3.280 $2,948.72 $1,294.56 30.51%
STU

78 $0.000 $0.00 $2.300 $179.40 $179.40
STU

322 $4.740 $1,526.28 $2.300 $740.60 $785.68 51.48%
WHS

4,500 $3.730 $16,785.00 $3.560 $16,020.00 $765.00 4.56%
WHS

6,979 $6.000 $41,874.00 $3.560 $24,845.24 $17,028.76 40.67%
WHS

2,880 $0.000 $0.00 $3.560 $10,252.80 $10,252.80
WHS

641 $3.710 $2,378.11 $3.560 $2,281.96 $96.15 4.04%

18.84%


Total cost Market value Change

$278,114.45 $330,523.33 $52,408.88



Share Investor Portfolio @ Share Investor


Share Investor Portfolio: Value @ 10 January 2011
Share Investor Portfolio: Value @ 3 January 2011
Share Investor Portfolio: Value @ 27 December 2010
Share Investor Portfolio: Value @ 20 December 2010
Share Investor Portfolio: Value @ 13 December 2010
Share Investor Portfolio: Value @ 6 December 2010
Share Investor Portfolio: Value @ 29 November 2010
Share Investor Portfolio: Value @ 22 November 2010
Share Investor Portfolio: Value @ 15 November 2010
Share Investor Portfolio: Value @ 8 November 2010
Share Investor Portfolio: Value @ 1 November 2010
Share Investor Portfolio: Value @ 25 October 2010
Share Investor Portfolio: Value @ 18 October 2010
Share Investor Portfolio: Value @ 11 October 2010
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c Share Investor 2011