valuemanbuyer
13 Jan 2017
Re: SP V interesting thx Mal.The recent note from HSBC says freecashflow is 7.5% and the price is down 6% since then . The warmest autumn on record affects sales badly .this has already started to reverse and the current climate can only help. Thatvtogether with excess warehouse costs of £3m and the world stores distraction all affects negatively in the short term . However they are building for the future ( new product Director ) and taking online seriously .They tend to do well in recessions which is a good reason to hold . The freecashflow should increase as the store growth peters out as you suggest . I suspect we will look back upon £7 as a v good entry price with a huge yield .
malj1
13 Jan 2017
Re: SP Y’day JL was portrayed as success. Their best performer was Home. JL don’t provide LFLs but on a qtr equivalent to DUN their home t/o was ca +3% yoy – a flat qtr with a bumper week pre Xmas eve. DUN delivered +3.3% with far fewer big ticket items in their mix – so they’re doing v well within their market segment. More important is cash flow. No one looks at this! Q2 opening net debt £83m & £103m at close. So cash generation -£20m. This after one off costs -£3m erp reorg, acquisition initial costs -£6.2m & -£1m (acquisition process costs n/a yet, but not nothing) & final dy pmt £38.6m (19.1p ps) = free cash £28.8m. This after 5 new super stores & 3 refits. Annualised this equates to £115m pa (57p ps) after funding +20 st (far too high) & 12 refits (about right). DUN can easily reach target +200 S st in 4 years, making the business 1/3 larger, generating ca 75p ps free cash. At that point the rollout could be capped, the business run as a cash cow, saving capex & w/c ca £15m pa / 7.5p ps. So it throws of 82p ps pa free cash. Housing transactions / consumer confidence could be higher or lower than currently – I doubt lower, but there is margin of safety in the above no.s. UK housing transactions peaked short term spring 16, have been falling since but are now in turnaround. So over the next 4 years you should receive growing dy + variable spec dy upto total pmt ca 57p/82p pa. Then the business gets sold to private equity. At £7-50 ps this yields free cash min 11% post tax (& use of debt will further enhance this). Alternately you might invest in med term gilts at 1.2% PRE tax or FTSE a/s dy ca 3.5% post tax. So I still think there’s an exit capital value somewhere £16/£24 ps depending quite what plays out over the next 4 years.
musker ron
13 Jan 2017
Re: SP Look on this as a buying op and got back in @714. Think this is greatly oversold
wangbaudan
13 Jan 2017
SP TS not bad. Peel Hunt lower target price to £8 (whatever that might mean and on whatever it might be based). Hardly seems a reason to drop from £8 to £7. Buying op or something we don't know??
Cantseethewoodsforthetrees
12 Jan 2017
'Gaining share In a declining market.'Probably explains the steady selling
IOMINVESTCOM
13 Dec 2016
Nice turn higher from recent lows Nice to see 8.00 touched today.[link]
valuemanbuyer
30 Nov 2016
Re: Dunelm acquisitions look good, says ... Good to hear . A cold snap is always good for sales. Only reason share price is down is the warm weather which dampened sales. DUNELM do well in recessions so Brexit will benefit them as people trade down and other retailers struggle . They all have much lower margins than DNLM ( the true sign of a good company )
Cantseethewoodsforthetrees
30 Nov 2016
Re: Dunelm acquisitions look good, says ... Certainly queueing to get into the local Dunelm car park after 10am.Value proposition seems to be what people want pre-Xmas
jaymac3
29 Nov 2016
Re: Dunelm acquisitions look good, says ... Sorry guys but I don't think most of these "analysts" have clue about what they are saying about the true value of DNLM. INMHO these are worth £10 In the short term and about 20% higher in the next 12 /24 months.. They are moving rapidly upwards from being a very successful family controlled business to a serious major UK leader in the retail sector as they now have all the alternative methods of marketing covered and they are already the no.1 UK retailers of the primary market in Homewares. Mind you, I must admit that only a Brexit upset might prove me wrong but I think they are less likely to be affected then some other sectors..
IOMINVESTCOM
29 Nov 2016
Re: Dunelm acquisitions look good, says ... Jeffries are just re-confirming the 700 figure as they have had this price target since early July ie 5th July:--05 Jul 16 Jefferies International Hold 752.00 845.00 700.00 Retains08 Jul 16 Jefferies International Hold 752.00 700.00 700.00 Retains
Edgecourier
29 Nov 2016
Re: Dunelm acquisitions look good, says ... Jeffries set a price of 700 today!! But others are much higher. Jeffries are trying to lever the price down I think. New Price29 Nov 16 Deutsche Bank Hold 751.50 855.00 890.00 Retains 89029 Nov 16 Jefferies International Hold 751.50 700.00 700.00 Retains 700 28 Nov 16 Peel Hunt Buy 751.50 1000.00 1000.00 Reiterates 100027 Oct 16 JP Morgan Cazenove Overweight 751.50 890.00 890.00 Reiterates 890 20 Oct 16 Canaccord Genuity Buy 751.50 920.00 875.00 Upgrades 875 Strong Buy because I am way underwater on this one. Divi cover 2.43 could be another special divi next year?but wtfdik
IOMINVESTCOM
29 Nov 2016
Re: Dunelm acquisitions look good, says ... Because their price target of 7.00 was set back in September when the price was much higher.
Cantseethewoodsforthetrees
29 Nov 2016
Re: Dunelm acquisitions look good, says Jeff... 'hold'....with a target price of £7.00.....when the shares are currently trading at £7.45.Er, how does that work?
IOMINVESTCOM
29 Nov 2016
Dunelm acquisitions look good, says Jefferies Homeware retailer Dunelm (DNLM) has made a flurry of acquisitions which Jefferies said gives the company access to online expertise.Analyst Caroline Gulliver retained her ‘hold’ recommendation and target price of 700p after Dunelm bought WS Group out of administration, the majority of which is Worldstores, one of the UK’s largest online retailers of home and garden products.As part of the deal it has also acquired members-only online store Achica and Kiddicare, which sells children’s furniture.The shares were trading at 749p at the time of writing.‘Dunelm is buying Worldstores, Kiddicare and Achica, effectively out of administration,’ he said. ‘The deal gives Dunelm access to £100 million of sales and £10 million of operating synergies as Dunelm can harness Worldstores’ technology and online expertise. We think this is a good deal for Dunelm as it is paying a total of c.£26 million of 0.26x sales for it.’The shares firmed 2p or 0.2% to 745.5p yesterday.[link]
IOMINVESTCOM
28 Nov 2016
Acquisition of Worldstores, Achica and Kiddicare Decided rightly or wrongly to start a small position based on this aquistion. Probably because loss making and will not breakeven until 2018 I think it will boost online position well in the offering further out. Will watch to increase position on further weakness over time.RNS Number : 2647QDunelm Group plc28 November 201628 November 2016Dunelm Group plcProposed Acquisition of Worldstores, Achica and KiddicareDunelm Group plc ("Dunelm" or the "Company"
announces that, through a wholly owned subsidiary, Globe Online Limited ("Globe", it has today reached agreement to purchase the assets of the WS Group for a total consideration of GBP8.5m.The WS Group consists of Worldstores Limited ("Worldstores", Worldstores Kiddicare Limited ("Kiddicare" and Achica Limited ("Achica".The WS Group currently generates annualised revenue of c.GBP100m and has c.650 employees. Worldstores, which was established in 2008 by founders Richard Tucker and Joe Murray and is the biggest part of the WS Group, is one of the UK's largest online retailers of products for the home and garden. There are over 500,000 products on the site. Worldstores has built a proprietary technology platform that manages suppliers and enables rapid cross-docking of stock directly from suppliers to customers so that customers can have next day, or day of choice, delivery. Much of the product requires 2-man delivery.Achica is a members-only online store offering furniture, homewares and accessories, often at significant discounts to RRPs for limited periods through flash sales. Kiddicare is a multichannel retailer, selling nursery supplies and merchandise for children and young families.John Browett, CEO of Dunelm, commented: "We are excited by this opportunity to accelerate the growth of our internet operation, more than doubling its size, and enhancing our position as the destination Homewares retailer in the UK, both online and offline. Between the store network, broad product range and strong brand that Dunelm has built and Worldstores' extensive homewares and furniture offer and unique platform for next day delivery and flash sales, we will strengthen our leading position as the UK's Home of Homes."Richard Tucker and Joe Murray, Worldstores' founders, commented: "We're delighted to be working with Dunelm, in whom we have found a partner who shares our vision for our company and brands, and is backing our ambitious plans for growth."The WS Group management, including the founders, will continue to run the WS Group and will be appropriately incentivised.All three propositions complement Dunelm's existing offer. Furthermore, Worldstores provides an extensive furniture range and a unique technology platform which will provide Dunelm with additional benefits. Dunelm will also be able to improve performance by sharing product ranges, harmonising terms and extending the multichannel delivery proposition, the benefits of which Dunelm expects to be in the region of GBP10m per annum over the short to medium term.The Company plans to inject up to GBP15m into WS Group to fund historic working capital and to manage disruption for suppliers and customers. Dunelm will also pay c.GBP3m of ancillary and transaction related costs which are expected to be identified separately in the Group's accounts.The Board currently expects that in Dunelm's financial year ending 1 July 2017, from the date of acquisition, the WS Group will incur trading losses of around GBP5-10m. In Dunelm's financial year ending 30 June 2018, the first full year of ownership of the WS Group, it is expected that the WS Group will be at least break-even.The acquisition is subject to each of the companies in the WS Group being placed into administration and the Company expects to acquire the WS Group businesses later today from the intended administrators, William Wright and Robert Croxen of KPMG LLP.ENDS
