Bonmarche Share Discussion Threads

[aleman] 22/1/2018 07:56

Which stores are not viable? The company already has a rolling program of openings and closures to weed out underperforming shops since it has short leases. Earnings are expected to be in line, given average weather. It is forecasted to be milder so could yet beat forecasts.

[thorpematt] 22/1/2018 01:18

....So reading between some lines of commentary:-

"..we have a number of self help initiatives in progress or planned for FY19, which are expected to deliver profitable like for like sales growth in stores, and the continuation of strong sales growth online."

By mentioning LFL sales growth in stores it will mean that if for example 10% are closed the comparison in total sales can continue to see a reduction whilst at the same time the BoD can report an improved perofrmance on a LFL basis.

This is OK as a strategy but it's difficult until we have clarity to be confident with forecasts. I note the recent small reduction in broker guesses for the FY 2018 and depending on how many babies get thrown out with how many baths, the cost associated could be pretty varied.

[thorpematt] 22/1/2018 00:59

The ones which are not viable. There will be many out of the 324 which need to be closed.

Part of Mrs. Connolly's "self-help initiatives" will need to include this unfortunatly. Some will be more costly to exit than others of course but long term it has to be so.

[aleman] 21/1/2018 23:33

What stores?

[opodio] 21/1/2018 23:29

How on earth can they get out of those stores

[aleman] 21/1/2018 23:28

Yes, the market was MORE challenging yet better stock management meant BON's margins ROSE so they are still trading IN LINE.

[opodio] 21/1/2018 23:25

will warn soon

[opodio] 21/1/2018 23:25

Bonmarché becomes latest victim of high street gloom
0


Jon Yeomans Ashley Armstrong, retail editor
19 JANUARY 2018 • 9:30AM
Bonmarché was the latest victim of the high street gloom after shares in the over-50s womenswear retailer tumbled by almost a quarter following a slump in sales over the key Christmas quarter.

Sales in shops open more than a year tumbled 9.7pc in the 13 weeks to December 30, a performance that Helen Connolly, chief executive, labelled "disappointing".

Strong online sales growth of 28.5pc failed to offset the poor performance of its stores, resulting in an overall fall in like-for-like sales of 6.9pc. Total sales slumped 5.5pc.

Ms Connolly blamed a "challenging" clothing market, particularly on the high street. She said the market for 50-plus women's clothing had shrunk during the year.

Industry figures revealed earlier this month showed that the high street suffered its worst Christmas sales growth in five years as shoppers shifted online and hunted for cheaper options.

The Bonmarché failed to comfort investors by warning that "uncertainty" would remain for the rest of the year and that weather was the biggest risk to consumer shopping behaviour.

[opodio] 21/1/2018 23:22

Adding to the UK retail woes was Alternative Investment Market stock Bonmarché (BONB +
), down 23% at 97.3p after the clothing retailer reported a 5.5% slump in fourth quarter sales.

'The clothing market became MORE . challenging during this quarter, especially on the high street,' said chief executive Helen Connolly.

The triple whammy of bad news hurt retail stocks on the FTSE 100, which rose 13 points, or 0.2%, to 7,714.

[aleman] 21/1/2018 18:37

"Anticipating the continuation of difficult market conditions during our third quarter, we adjusted our stock purchasing plans, and therefore the level of discounting was reduced compared to last year, resulting in a slight improvement in the gross margin percentage."

Q3 total sales down 5.5%. Margins up. H2 earnings last time were 7.0p. Could still hit that again although could also be a bit under. 6.8p earnings in H1. FY earnings looking like 13p+? That would be slightly ahead of consensus.

[onjohn] 21/1/2018 18:13

10pc Shorts open on this smelly dog

[aleman] 21/1/2018 17:31

BON are on fairly short leases.

Whilst much attention is rightly directed at the increasing importance of online shopping, our strategy is to develop Bonmarché as a multi-channel business, since customers who shop via both channels are the most valuable. Furthermore, the store estate remains the preferred shopping channel for the majority of our customers. Notwithstanding this, the flexibility of our leases means that, if that view changes, we are in a position to alter the profile of the store estate relatively quickly.

Last year, stores' LfL were +0.8% for the Christmas quarter versus -5.3% YTD. This year Christmas stores' LfL is -9.7% versus YTD -2.8%. Last year Oct and Nov were cold - good for autumn sales of winter clothing - but Dec was warm which is good for Christmas sales. This year Oct was warm and early Nov were warm - bad for autumn sales - and late Nov and Dec were cold and snowy - bad for Christmas sales. BON's older customer profile and stores in garden centres make it more vulnerable to weather and sales were broadly in line with weather, creating a bad comparative year-on-year. The underlying trend may have deteriorated slightly, as with other chains, but is still probably pretty reasonable and profit continues to be in line. There are intiatives in train which should probably improve the underlying trend but January weather started off cold and snowy, hence the cautiously worded weather comment in the update. The snow is expected to end today and double figure temperatures are expected next week. Weather might improve the trend from here. There might even be a boost from postponed demand when older customers make it back into the shops and start buying spring bedding plants and vegetable seeds from garden centres.

Now reread the unusually worded trading update.

Helen Connolly, Chief Executive Officer of Bonmarché, said:

"The clothing market became more challenging during this quarter, especially on the high street; consequently our store LFL was disappointing. We are pleased with the strong growth we achieved in online sales, reflecting our strategic focus in this area. Following the trend seen throughout this year, the 50+ women's outer/sportswear market declined compared to last year, however Bonmarché continued to grow its share*.

There remains uncertainty as to how trading conditions will evolve as we enter our final quarter. We do not anticipate material changes in the underlying market conditions, and in this short term outlook, the weather represents the most significant uncertainty due to its effect on consumer shopping behaviour, with the risks equally weighted on the up and downsides. At the end of the third quarter, the Board's view of the likely outcome for the full year remains in line with previous expectations.

Looking further ahead, whilst we expect the market to remain difficult, we have a number of self help initiatives in progress or planned for FY19, which are expected to deliver profitable like for like sales growth in stores, and the continuation of strong sales growth online."


BON stores are more vulnerable to wintery weather but might improve more than competitors when it ends. I read from the update that we might even exceed earnings forecasts if weather is favourable from here - but that is just guesswork. The overreaction to the revenue numbers, while ignoring the expectation of in line earnings on average Q4 weather, is possibly a buying opportunity. I increased my holding by over 600% on the spike down.

[opodio] 21/1/2018 15:59

The administrators be knocking on BON door soon

300 derelict stores, could be a fire sale like with woolies, they need to get out of these leases quick

DEB be bust soon and imagine all that surplus stock washing its way to market, the cheapskates who shop at BON will be buying their togs at DEB


TIMBERR!!

[eastbourne1982] 21/1/2018 14:28

Whilst I don't like wasting my time and consider you are clearly a waste of time.

Results in November 2017 showed net cash of £14.9 million, up 5 million from the year before which is clearly a considerable amount for a company of this size.

[onjohn] 21/1/2018 14:14

You would have saved ur butt listening to me on this and CPR blondeamon

This one is finished its the zombie stores that will kill it

Dividend will be cancelled

[blondeamon] 21/1/2018 11:15

ONJohn and larva have been filtered months ago and never looked back, save yourselves the mental anguish of looking on their posts.

[eastbourne1982] 21/1/2018 11:06

ONJohn,

You totally ignore other aspects of the results, look at the last half year results, profits up considerably, look at online over the last year, up considerably.

As I say you are a moron.

[aleman] 21/1/2018 10:47

I like toast. I like strong balance sheets. I like fat dividends. I like profit in line with forecasts.

Don't you like toast?

[onjohn] 21/1/2018 10:19

whichever way you cut it they are in real trouble with two years of plunging like for like

[eastbourne1982] 20/1/2018 20:54

Please explain how it's toast ??

I won't hold my breath as you are obviously an absolute moron.