Marks And Spencer Share Discussion Threads

[darrin1471] 29/2/2024 07:39

Fair value measurement - contingent consideration due from M&S

At the reporting date, the fair value of contingent consideration due from Marks and Spencer Holdings Limited ("M&S"), agreed on the disposal of 50% of Ocado Retail Limited ("Ocado Retail") to M&S in August 2019 is 28.0m.

Under the terms of the disposal, a final payment may become due from M&S to Ocado Group of £156.3m plus interest, dependent on certain contractually defined Ocado Retail performance measures (the 'Target') being achieved for the FY23 financial year (the 'Contingent Consideration'). The contractual outcome is binary, meaning if the Target is achieved, it will trigger the payment in full of £190.7m (£156.3m plus £34.4m of interest, assuming a payment date of August 2024). Conversely, should the Target not be achieved, no consideration would be payable by M&S. There is no formal arrangement for a payment between zero and £190.7m.

The contractual arrangement with M&S expressly provides for the Target to be adjusted for certain decisions or actions taken by Ocado Retail management that differ from the assumptions used in the discounted cash flow model which underpinned the sale transaction.

The actual FY23 performance is below the Target required for automatic payment of the Contingent Consideration. However, the Group has identified a number of significant decisions and actions taken by Ocado Retail management that it believes require adjustment to the Target under the terms of the contractual agreement with M&S. The adoption of these adjustments, if established, would result in Ocado Retail achieving the Target (as adjusted) and the full payment of £190.7m.

The contract requires the shareholders to engage in good faith discussions concerning possible adjustments, and we intend to pursue that process, however there can be no assurance that an adjustment proposed by one party will be eventually accepted by another or that a wider agreement will be reached and if so formal legal proceedings may well result. It would be prudent to assume that in any negotiation or legal proceedings M&S would propose adjustments to the Target of their own.

The fair value of £28.0m recorded in respect of the Contingent Consideration under IFRS 13 has been estimated using the expected present value technique and is based on a number of probability-weighted possible scenarios that a market participant would consider in valuing the contract reflecting the facts and circumstances that existed at the balance sheet date. It is management's belief that the fair value currently recorded is significantly lower than the amount that Ocado may receive at the point of settlement.

[darrin1471] 29/2/2024 07:38

Fair value measurement - contingent consideration due from M&S

At the reporting date, the fair value of contingent consideration due from Marks and Spencer Holdings Limited ("M&S"), agreed on the disposal of 50% of Ocado Retail Limited ("Ocado Retail") to M&S in August 2019 is 28.0m.

Under the terms of the disposal, a final payment may become due from M&S to Ocado Group of £156.3m plus interest, dependent on certain contractually defined Ocado Retail performance measures (the 'Target') being achieved for the FY23 financial year (the 'Contingent Consideration'). The contractual outcome is binary, meaning if the Target is achieved, it will trigger the payment in full of £190.7m (£156.3m plus £34.4m of interest, assuming a payment date of August 2024). Conversely, should the Target not be achieved, no consideration would be payable by M&S. There is no formal arrangement for a payment between zero and £190.7m.

The contractual arrangement with M&S expressly provides for the Target to be adjusted for certain decisions or actions taken by Ocado Retail management that differ from the assumptions used in the discounted cash flow model which underpinned the sale transaction.

The actual FY23 performance is below the Target required for automatic payment of the Contingent Consideration. However, the Group has identified a number of significant decisions and actions taken by Ocado Retail management that it believes require adjustment to the Target under the terms of the contractual agreement with M&S. The adoption of these adjustments, if established, would result in Ocado Retail achieving the Target (as adjusted) and the full payment of £190.7m.

The contract requires the shareholders to engage in good faith discussions concerning possible adjustments, and we intend to pursue that process, however there can be no assurance that an adjustment proposed by one party will be eventually accepted by another or that a wider agreement will be reached and if so formal legal proceedings may well result. It would be prudent to assume that in any negotiation or legal proceedings M&S would propose adjustments to the Target of their own.

The fair value of £28.0m recorded in respect of the Contingent Consideration under IFRS 13 has been estimated using the expected present value technique and is based on a number of probability-weighted possible scenarios that a market participant would consider in valuing the contract reflecting the facts and circumstances that existed at the balance sheet date. It is management's belief that the fair value currently recorded is significantly lower than the amount that Ocado may receive at the point of settlement.

[johnwise] 28/2/2024 07:25

Marks & Spencer revival reflected in Waitrose woes


Marks and Spencer Group PLC (LSE:MKS) sales moved higher again as its growing grip on the upmarket section of the retail grocery market was confirmed again with more lacklustre numbers from key rival Waitrose.

Which? readers yesterday voted M&S the UK’s most popular supermarket for a third year running , with the chain citing gains from Waitrose as one of the reasons for its recent popularity.

Waitrose sales were up 3.8% over the past year compared to 5.1% growth across the wider industry in the same period, including M&S, data from market researcher Kantar showed.

[philanderer] 28/2/2024 00:34

'M&S makes dig at Aldi after victory in copying claim - Aldi 'considering position''

[ccsicemanandrew] 27/2/2024 16:48

It's just a reference to the weekends Times article. Ocado say no information will be given in this weeks update and talks are on going.No decision has been made by MKS yet.

[debsdowner] 27/2/2024 16:01

Missed this important article, MARKS to withhold multi million payment to Ocado for missing targets..payment could help the bottom line considerably !



Also Marks wins it's latest battle in appeal court with ALDI over gin patent infringement which could amount to a few hundred grand or more.

[philanderer] 27/2/2024 14:08

'Marks & Spencer raises pay in battle for supermarket staff'

[ccsicemanandrew] 27/2/2024 10:41

10% pay rise for staff.

[johnwise] 27/2/2024 08:06

Hello Magazine


This £39.50 Marks and Spencer dress is about to sell out

The denim midi from its new spring '24 collection is flying off the shelves

[thebears1] 27/2/2024 07:57

Is there any relevance to MKS on these?

[philanderer] 26/2/2024 15:17

M&S withholding multi-million pound payment to Ocado over performance failures


Ocado slumped on Monday following a report over the weekend that Marks & Spencer is withholding a multimillion-pound payment to the group after their grocery delivery venture missed key performance targets.

The companies joined forces in 2019 to create Ocado Retail, a £750 million tie-up that gave Ocado customers access to M&S food.

Under the terms of the deal, M&S is due to pay Ocado a final instalment of £190.7m by August. The payment is contingent on Ocado Retail’s performance against an undisclosed target in the year to November 2023.

According to The Times, it is understood that M&S is still in negotiations with Ocado over the payout as performance hurdles have "not been met".

The final payment is binary, meaning that M&S must pay the sum in full or not at all. There is a mechanism in the contract, however, for "adjustments" to be made if both sides agree.

There has been speculation over how much M&S would end up paying Ocado after the online grocer cut the "fair value" of the payout by another £17m to £78m in November, while M&S cut it to zero. Insiders told The Times there was unlikely to be an update on Thursday, when Ocado publishes its full-year results, as talks are still continuing.

At 1105 GMT, Ocado shares were down 5.5% at 499.40p.


Sharecast.com

[blackhorse23] 26/2/2024 09:14

https://news.sky.com/story/amp/former-prince-andrew-aide-eyes-role-in-takeover-bid-for-currys-13080842

[johnwise] 26/2/2024 07:14

It's an opportunity to shop with a better class of customer.. I don't see many "Tattoos are Us" shopping in M&S


Revealed: Marks and Spencer is the UK's favourite supermarket (even though consumers admit it's a 'bit pricey')... where does YOUR go-to rank?

High-end supermarket finished top in the Which? study for third year in a row

[philanderer] 24/2/2024 23:38

'Supermarket crowned overall best in UK'



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[grupo] 24/2/2024 10:46

La Forge
24 Feb '24 - 10:04 - 2890 of 2891
0 1 0

[la forge] 24/2/2024 10:04

hxxps://moneyweek.com/investments/mands-is-back-in-fashion-but-how-long-can-this-success-last

[blackhorse23] 23/2/2024 08:25

Business is booming at greencore group. GNC [LSE] Strong start to FY24 tradingFY23 revenue up 10% to 1.9 billion EBITDA up 5% to 132.8mProfit up 6% to 76.3m2024 Profit Growth 10% to 80m-85m

[johnwise] 20/2/2024 06:13

M&S' £25 chinos in nine colours hailed as a must-have for spring - 'perfect fit'

Chinos are the ultimate casual wear for when the weather warms up, with one £25 pair from Marks and Spencer (M&S) being snapped up by shoppers already.

[johnwise] 19/2/2024 19:01

VIDEO

Britain is finished, the exodus begins...

[1mikejay] 19/2/2024 07:47

Agree still cheap though

[debsdowner] 18/2/2024 13:55

Currys rejects takeover offer..





Offer is clearly undervalued Currys agrred to sell on of it's operations for £175 million in November.

It's a good job Marks has rebounded following reorganisation as company was undervalued by a wide margin over a year ago and it could have meant a predator tried to buy Marks on the cheap.