NCK FH24 -- well run retailer with some growth

 NICK SCALI FH24 RESULT

The company guided to $40-42m and came in with $43m. Revenues $227m were a bit softer than I was thinking but cost control through optimisation and falling logistical expenses made up the difference. GM improved from 62% to 65.6%, about the same as 2H23. Well run good cost control. The six months to June saw $224m in revenues but in a seasonally weaker period. The company stated January up 3.6%pcp, continuing Q223 strength. Q1 soft.

The LT store roll targets look to have been moved up for Plush 90-100 (maybe im wrong here), NS stays at 86 stores. Taking the midpoint of Plush and assuming 5 years to execute and similar size stores would add 8% pa to sales, which is meaningful and a core of the thesis.

Looks to be a bottoming in sales but is dependent on the broader spending environment.

The debt from the Plush acquisition continues to be paid down. $20m paid this half, $28m to go, overall $4m ND.

Mentioned consumer sentiment could be improving.

I see double-digit cagr on NCK including a dividend from $12.42 over the next 5 years at a relatively lowish risk.

 held not top 10

Please note the disclaimer.


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