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Bad news for high St retailers continues-getting grim out there.


sancho panza

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17 minutes ago, sancho panza said:

...

Mike Ashley’s Flannels fascia has been granted £125,000 in business rates relief by a local council in order to prevent one of its sites remaining derelict.

...

I read that and my immediate thought was 'I know his shops aren't nice, but calling them derelict is a bit much...'

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The Masked Tulip

 

 

Financial journalists are unhappy this morning as M&S cancelled its annual Christmas press junket at the last minute yeserday. Asda and MacD's UK have apparently done the same.

Primark warned a few days ago about how challenging the High Street is. Bonmarche and Dixons (Currys) are doing badly. Debenhams is a mess. The online clothing darling Asos, according to one investment bank, is burning through cash and the shares have plunged.

Looks like the clothing retailers are doing badly. It will be interesting how well the food retailers do - Tesco, Sainsbury's, Morrisons, etc - and whether food can save M&S again. Wonder why they cancelled their press junket last night? Hmm..
 

 

 

 

 

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The Masked Tulip

I had been considering some of the UK retailers - namely ASOS and BOO. I think it was Morgan Stanley that lowered forecast for ASOS this week dropping the price to the mid to low £3 area - which will be a 50% fall from the highs this year.

Which makes me stop and think about BOO - if ASOS is doing badly then what about BOO? BOO is younger people though so perhaps they are spending? Who knows.

But a warning from Primark is disturbing and now today's bad results from Sports Direct - who will buy my shell-suits and white socks? - is not a good sign at all.

I think the best bet for the FTSE is probably commodities IF there is a China-US trade truce and IF the US Fed stops raising rates.

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2 hours ago, The Masked Tulip said:

 

 

Financial journalists are unhappy this morning as M&S cancelled its annual Christmas press junket at the last minute yeserday. Asda and MacD's UK have apparently done the same.

Primark warned a few days ago about how challenging the High Street is. Bonmarche and Dixons (Currys) are doing badly. Debenhams is a mess. The online clothing darling Asos, according to one investment bank, is burning through cash and the shares have plunged.

Looks like the clothing retailers are doing badly. It will be interesting how well the food retailers do - Tesco, Sainsbury's, Morrisons, etc - and whether food can save M&S again. Wonder why they cancelled their press junket last night? Hmm..
 

 

 

 

 

Wow...impressive stuff.A lot of retailers getting burned today.

image.thumb.png.d3f35d90ba360e85e33432b40679c564.png

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The boy who cried wolf springs to mind.

Certainly I see reasons to on paper at least be positive. Petrol prices fallen back , Wages on paper rising above inflation, number of trading days.

On the negatives Black Friday seems to have moved rapidly to an online trend. The weak pound is not great help (will lump Brexit in there). The housing market looks in terrible shape. 

I’m on the fence at the moment. Just trying to look for retailers strategies - A few are starting their sales. Mothercare (at least from the stores) seems in distress to me but I’ve not looked at their latest cash flow statement.

Also as an aside A few of the discounters I visited staff in store did not know what they sold or where it was in the store. Loads of customers wandering the store- who knows where x is? I’ll check out the Poundstretcher results posted upthread.

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7 hours ago, Ash4781b said:

Wages on paper rising above inflation

Wages aren't rising anywhere except in the nonsense statistics. Wages haven't really gone up since 1970. With the current rises in utility bills, council tax, insurance, TV, phones, food etc etc people are far poorer in real terms and have far less money available.

It's quite simple. Bills have been rising at such a rate that no amount of pay rises can possibly keep up. The average wage would need to be £30,000+ to even begin to even things out.

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It's not just maths causing the high street problems.

People are staying away from town centres because of the number of undesirables owning the street.

Older people don't want to spend their day dodging beggars and watching cider -clinging no-hopers kick pigeons.

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58 minutes ago, Errol said:

Bad weather hits Christmas shopping on the High Street

https://www.bbc.co.uk/news/business-46583424

It's largely irrelevant for Christmas shopping.

People have a certain quantity of presents that need to be bought, and will spend the money to buy them come what may.  

What matters is:

  • How much they want to spend this year vs previous years.
  • Whether they can be organised enough to do the shopping on the internet.

 

 

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More out in the Mail on Sunday of Ashley’s Debenhams offer. I’m sure we will see more in the week? 

‘He has obviously got frustrated – mostly because we wouldn’t do exactly what he wanted. But we genuinely couldn’t, mainly because the board couldn’t hand him a deal where he had effective voting control and secured debtor position which would put him ahead of the pension fund and ahead of our banks.

‘I’m sure – at least I hope – that Mike didn’t intend to create this but it destabilises our suppliers.’

Buying the firm would cost Ashley as much as £500 million, analysts said. That would include more than £300 million debt and offering a ‘multiple’ of the current 5 pence share value. Cheshire added that the board, which includes chief executive Sergio Bucher, has since had feedback from lenders endorsing its decision. Other shareholders said Sports Direct had not contacted them to discuss Ashley’s strategy.”

 

https://www.thisismoney.co.uk/money/markets/article-6499859/Put-money-mouth-Debenhams-chairman-issues-bid-ultimatum-Sports-Direct-owner.html

 

 

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1 hour ago, dgul said:

It's largely irrelevant for Christmas shopping.

People have a certain quantity of presents that need to be bought, and will spend the money to buy them come what may.  

What matters is:

  • How much they want to spend this year vs previous years.
  • Whether they can be organised enough to do the shopping on the internet.

 

 

Average spend downwards as you infer, but  many people will buy fewer presents overall i.e. for fewer people. I know I have, and I'm not suffering from any financial shocks or hard up. Things like presents for the office/colleagues or distant aunties will get cut. They aren't big ticket items but it'll still matter.

 

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5 minutes ago, spunko said:

Average spend downwards as you infer, but  many people will buy fewer presents overall i.e. for fewer people. I know I have, and I'm not suffering from any financial shocks or hard up. Things like presents for the office/colleagues or distant aunties will get cut. They aren't big ticket items but it'll still matter.

 

Right -- and they'll blame the weather (or Brexit) for what is actually a return to saner times compared with the 20 year period of irrational over-consumption.

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24 minutes ago, spunko said:

Average spend downwards as you infer, but  many people will buy fewer presents overall i.e. for fewer people. I know I have, and I'm not suffering from any financial shocks or hard up. Things like presents for the office/colleagues or distant aunties will get cut. They aren't big ticket items but it'll still matter.

 

well in the past we have had female nurses so they sort of harrased us into secret santa,sending cards to each other a works meal/piss up and takeing food in and haveing a buffet for everyone.now we have male nurses no one gives a fuck its ace.

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8 hours ago, Ash4781b said:

More out in the Mail on Sunday of Ashley’s Debenhams offer. I’m sure we will see more in the week? 

‘He has obviously got frustrated – mostly because we wouldn’t do exactly what he wanted. But we genuinely couldn’t, mainly because the board couldn’t hand him a deal where he had effective voting control and secured debtor position which would put him ahead of the pension fund and ahead of our banks.

‘I’m sure – at least I hope – that Mike didn’t intend to create this but it destabilises our suppliers.’

Buying the firm would cost Ashley as much as £500 million, analysts said. That would include more than £300 million debt and offering a ‘multiple’ of the current 5 pence share value. Cheshire added that the board, which includes chief executive Sergio Bucher, has since had feedback from lenders endorsing its decision. Other shareholders said Sports Direct had not contacted them to discuss Ashley’s strategy.”

 

https://www.thisismoney.co.uk/money/markets/article-6499859/Put-money-mouth-Debenhams-chairman-issues-bid-ultimatum-Sports-Direct-owner.html

 

 

Youd think Ashley wouldn't steer his good ship into a storm.if the outlook for retail is so bad why he's eyeing so many down and out compnaies?

https://www.theguardian.com/business/2018/dec/13/mike-ashley-launches-debenhams-broadside-sports-direct

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15 hours ago, Noallegiance said:

It's not just maths causing the high street problems.

People are staying away from town centres because of the number of undesirables owning the street.

Older people don't want to spend their day dodging beggars and watching cider -clinging no-hopers kick pigeons.

That would not explain trouble in online paradise, though.

At my place sales are up YoY due to massive cannibalising of high street, but promotions are the new normal, margin cutting is massive, sales are nowhere near the forecast from just 3 months ago and November was a huge disappointment (after Sep and Oct which were just regular, run-of-the-mill disappointments).

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On 13/12/2018 at 12:41, The Masked Tulip said:

I had been considering some of the UK retailers - namely ASOS and BOO. I think it was Morgan Stanley that lowered forecast for ASOS this week dropping the price to the mid to low £3 area - which will be a 50% fall from the highs this year.

Boom.

image.png.b83d9ef0d74a7beb978f9bf8be132eeb.png

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Democorruptcy
26 minutes ago, MrXxx said:

Asset stripping?

If he's buying assets on the cheap that would make sense but with such as House of Fraser he's buying leases and busy negotiating to lower rents. Maybe he's going for the too big to fail approach and the governbankment handouts that could involve? "Let me go under and there is no high street and xm job losses". Size is power?

He could be someone to get onside about council fat cat pay. Near me previously free car parks are becoming chargeable. I see parking meters as fat cat pension machines. Increased parking charges because fat cats think the "cuts" don't apply to their trough, will reduce his footfall. 

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Just now, The Masked Tulip said:

Sh*t! Bad sales?

Profit warning. -42% atm, dragging other  retailers down with them. BooHoo is down 10%.

ASOS stated UK sales rising higher than forecast but Germany and France doing very badly. Didn't stop Guardian from putting a good ol' Brexit Uncertainty spin on it :D

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The Masked Tulip
6 minutes ago, kibuc said:

Profit warning. -42% atm, dragging other  retailers down with them. BooHoo is down 10%.

ASOS stated UK sales rising higher than forecast but Germany and France doing very badly. Didn't stop Guardian from putting a good ol' Brexit Uncertainty spin on it :D

That surprises me about where the sales are poor. You have to question Boohoo though and wonder what their sales are like.

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The Masked Tulip

Boohoo came out with an rns saying that they are doing OK - whether to believe that or not of course.

This is not a Brexit issue but an EU issue. The continent is in a mess of not in recession already.

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5 hours ago, kibuc said:

That would not explain trouble in online paradise, though.

At my place sales are up YoY due to massive cannibalising of high street, but promotions are the new normal, margin cutting is massive, sales are nowhere near the forecast from just 3 months ago and November was a huge disappointment (after Sep and Oct which were just regular, run-of-the-mill disappointments).

Which sector are you in Kibuc? Are you clothing online? You know I'm asking for specifics for purely selfish reasons so please feel free to not repsond.Azzuri has written some interesting posts from the travel sector and there's nothing like coalface reports from what you consider reliable sources.

Wolf has been psoting variously that food/shoe sales have held off the online competition.Margin compression has been oft discussed in teh Defl thread.

Decl: I put a short on Dunelm  last week ,as you prob know I've been shroting UK retail for some time in dribs and drabs but feel duty bound to declare my interest given my question.

5 hours ago, kibuc said:

Boom.

image.png.b83d9ef0d74a7beb978f9bf8be132eeb.png

Incredible drop.Goes to show how -alongside Primark sales drop mentioned by @Barnsey iirc-that it's the more marginal demand that appears to be getting stuffed.

5 hours ago, Democorruptcy said:

If he's buying assets on the cheap that would make sense but with such as House of Fraser he's buying leases and busy negotiating to lower rents. Maybe he's going for the too big to fail approach and the governbankment handouts that could involve? "Let me go under and there is no high street and xm job losses". Size is power?

 

It's like they say buying an aged car is buying someone elses problems.I suppose if the discount is cheap enough but High st is seriosuly sick.

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