Majestic Wine Share Discussion Threads

[cockneyrebel] 10/7/2015 09:26

Nice and quiet here :-)

CR

[cockneyrebel] 03/7/2015 12:27

Been buying back yesterday and today those I sold recently.

Was a bit overbought but after the retrace and that large volume yesterday these look attractive again imo.

All imo.

CR

[gucci] 26/6/2015 14:22

Let's hope there is a chance to buy closer yo 300p

[lauders] 21/6/2015 01:03

Not a holder here but this might prove useful to some:

Full year results from the UK’s largest wine specialist released today don’t look that ‘rosé’ at first glance. However, with much of the bad news already anticipated, they also show how new Chief Executive Rowan Gormley has a cracking little business in which to inject some online magic.

Revenue was up 2.3% to £284.5m and like for like sales in UK retail stores up 1.9% (2014: -0.1%). Group profit before tax declined to £18.4m (2014: £23.8m) with the biggest impact largely through higher Administrative costs which rose 31.4% to £18.5m and included £1.8m acquisition costs and £0.7m of termination payments.

Group cash flow generated from operations was a warming £32.9m (2014: £23.6m) with the improvement arising largely due to timing differences.

The number of active customers rose 5.4% to 678,000 and online sales increased 12.4% to £31.1m and representing 12.1% of UK retail sales; clearly the purchase of Naked Wines is going to move the latter number dramatically going forward

Thankfully the new store opening programme has slowed with a net 7 new stores opened during the year (10 new openings less 3 closures) compared to 12 in the prior year, bringing the total number of stores trading at the financial year end to 212. . It seems that the penny has finally dropped that they don’t need to madly open more and more stores and now envisage that the total estate needs to be between 225 and 250 rather than the 330 previously indicated.

Mr Gormley has only been Group CEO for ten weeks so is still making his tasting notes but commented there was a need “to make investments to reinvigorate Majestic Wine” and that these “investments will initially suppress profit in the short term”.

We particularly like 3 of the priorities given in the results statement, to:

- Make the shopping experience simpler, easier and more fun”,

- Rebuild the supply chain to optimise ‘On Shelf Availability’ and reduce working capital requirements

- Limit new store openings to the 20-30 locations that can deliver a good return on investment.

The proposed initiatives will initially incur £3m during the current financial year.

The Commercial business which supplies restaurants, hotels and gastro pubs seems to be doing well with sales up 12.8% on last year to £42.1m.

We are hugely impressed with the Naked Wines’ offering, and if a little Naked innovation can be passed onto the larger Majestic business it could be an interesting one to follow.

- See more at:

[emeraldzebra] 19/6/2015 11:47

yes - my feeling is that it will be a long haul and this rating is just too demanding of the share price in the short term. Patience should be rewarded eventually as i think the new guy has some bright ideas, but for now, would look for a retrace to low mid 3's.

[cestnous] 19/6/2015 07:56

I.C> today


Majestic sacrifices dividend
Investors may hope for a turnaround now that Rowan Gormley has taken the reins at Majestic Wine (MJW). Mr Gormley arrived as part of April’s £70m acquisition of his own company, Naked Wines. But the results of an ongoing strategic review won’t be available until half-year results are published in six months’ time. For the year to March 2015 – prior to Mr Gormley’s arrival – the group waived the final dividend to cover the cost of the deal, as had been expected.
Even the group calls the period “challenging”. A modest increase in market share lifted like-for-like sales in UK retail stores by 1.9 per cent. But a number of one-off costs relating to the Naked Wines deal and a fiercely competitive marketplace pulled pre-tax profit down by 23 per cent. Squeezed gross margins – down 30 basis points to 22.7 per cent – and climbing distribution costs didn’t help, either.
Yet Majestic’s market reach could now expand eightfold, thanks to Naked Wines’ established footprint in Australia and the US. Similarly, Naked Wines’ well-developed online platform should boost Majestic’s own limited online capabilities. However, Mr Gormley warns this will take time and money. An extra £3m could be spent in the first half of the current financial year alone, but the expansion of the store estate will slow to between 225 and 250, compared with a previous target of 330.
Improving Majestic’s e-commerce business is high on the agenda. Last year online sales rose by more than 12 per cent and now account for 12.1 per cent of its total UK retail sales. Mr Gormley wants the website, the newly launched mobile app and retail stores to be complimentary and “work together” so that customers are confident shopping across all channels.
Analysts at Investec expect pre-tax profit of £18m for the year to March 2016, giving EPS of 19.1p, down from £20.9m and 24.1p last year.
C The market reacted anxiously to the changes taking place at Majestic – the shares dropped nearly 4 per cent on the back of these results, probably reflecting the guidance on higher costs. Mr Gormley has his work cut out integrating the businesses to achieve the holy grail of retailing: a seamless multi-channel operation. Majestic has a strong market position, but given the fall-away in profits and the strategic upheaval a forward PE ratio of 22 looks very steep. HR

Sell

[emeraldzebra] 17/6/2015 09:21

mreasy - this is true....but Majestic are not concentrating so hard on this crowd - they are after the slightly more discerning punter who is after something a bit different and more exclusive to your average super market shopper, and is prepared to pay a little more.

[mreasygoing] 17/6/2015 05:58

People wanting a bottle of wine for an evening meal want to buy conveniently so go to Waitrose, M and S or the supermarket where you can get a reasonable wine with your shopping.

[cestnous] 16/6/2015 11:22

Sold last Friday at a nice profit as I didn't see them going anywhere before Greeks screw up the market by the end of June. Will be back and I suspect at a better price as the new CEO is going to take some time to get things moving imo..
I could of course be completely wrong. Sold a few other things that were looking toppy for the Greek reason, to give myself some cash to go bottom fishing.

[emeraldzebra] 16/6/2015 11:00

much as i disagree with mike 740 on other post - he has a point here. i hear the new guy in charge has never made a profit ! Grounds for extreme caution i would think. i think this will re trace to mid 3's. lets see......

[jazza] 15/6/2015 15:39

Agreed, Mike.

Your posts smack of desperation.

[mike740] 15/6/2015 14:40

DESPERATION.

[mike740] 15/6/2015 09:44

Holders bottling lads, get the shorts on.

[cockneyrebel] 15/6/2015 09:33

Pretty much what you'd expect in the results after the fwd guidance they gave. Not going to be a rapid move north here imo, simply because of the timescale they have laid out.

Probably up with events for now and probably a better time to buy/add over the coming months imo.

Holding a few but banked a nice profit 150p a share since April on the bulk.

All imo/dyor etc

CR

[goliard] 15/6/2015 08:45

My 2 June post seems about right. Also, the new CEO has a big earn out which is based on his previous (Naked Wines) business hitting targets, so where do we think he will prioritise investment? Mmmmm, I wonder. Needs to get real at some point and I think the price should be closer to 300p at best.

Totally wrong to have appointed a CEO from a purchased business and target his earn out on the business he sold to them. Really terrible idea.

[mike740] 15/6/2015 08:35

Terrible update, best get shot especially with the Greek situation.

[scottishfield] 05/6/2015 09:39

and more :) nice little dip

[scottishfield] 04/6/2015 16:40

got some more at the close :)

[goliard] 04/6/2015 07:39

They'll need angels to help with those angles at some point ;-)

[dlku] 03/6/2015 14:15

BOO and SGP also racing northwards

[cockneyrebel] 03/6/2015 14:14

Testing the recent highs today.

CR

[goliard] 02/6/2015 08:09

I don't think the change in model should have a resulted in a 50% rise in value back to 450p. Not sure what will keep it up when the next results come out and there is clearly much more to be done. If Carlsberg did shorts.....