TPW - Temple & Webster Group

[System]

Temple & Webster (www.templeandwebster.com.au) is one of the leading online retailers for the home in Australia. It operates a members-only shopping club for the home, offering limited time, limited inventory sales events and has over 1.2 million members. Temple & Webster provides a curated offering of over 10,000 different products per month from over 400 suppliers.

The Group also operates ZIZO (www.zizo.com.au), one of Australia's largest online marketplaces for furniture and homewares which currently has over 100,000 products on sale from over 700 suppliers.

It is anticipated that TPW will list on the ASX during December 2015.

 

[skc]

Temple & Webster (www.templeandwebster.com.au) is one of the leading online retailers for the home in Australia. It operates a members-only shopping club for the home, offering limited time, limited inventory sales events and has over 1.2 million members. Temple & Webster provides a curated offering of over 10,000 different products per month from over 400 suppliers.

The Group also operates ZIZO (www.zizo.com.au), one of Australia's largest online marketplaces for furniture and homewares which currently has over 100,000 products on sale from over 700 suppliers.

It is anticipated that TPW will list on the ASX during December 2015.

Maiden report today... what an awesome sight.

The shares only floated early Dec at an IPO price of $1.10. It quickly tanked on the first day and has been running downhill ever since. Until today's report, where it ran out of hill and jumped straight over the cliff.

The stock finished at a low of 20c. That's the worst tanking IPO in recent memory. Who floated these guys again?

P.S. It's one thing to claim to be a new age internet business, it's quite another to be just another internet business that sell things where there are heaps of alternatives. Of course you are going to record revenue growth when you sell things cheap coupled with a great service. Surfstitch is one example (which incidentally crashed today as well)... the items are cheap, delivery was very fast, and they even include a return prepaid envelop if the size is not a good fit. But these companies are only growing their business by subsidising customers at the expense of shareholders. The moment they want to stop competing on price, the 'loyal' customers will quickly switch to any one of the 90 other websites out there.

 

[McLovin]

P.S. It's one thing to claim to be a new age internet business, it's quite another to be just another internet business that sell things where there are heaps of alternatives. Of course you are going to record revenue growth when you sell things cheap coupled with a great service. Surfstitch is one example (which incidentally crashed today as well)... the items are cheap, delivery was very fast, and they even include a return prepaid envelop if the size is not a good fit. But these companies are only growing their business by subsidising customers at the expense of shareholders. The moment they want to stop competing on price, the 'loyal' customers will quickly switch to any one of the 90 other websites out there.

Spot on. Remember The Iconic? It's still going, but once they stopped spending $10's of millions on advertising everyone forgot about them. Selling stuff on the internet is a retail business, not a tech business. My sister was a poor uni student and used to order from The Iconic because it was cheap. She'd order 3 or 4 different sizes of the same product and then everything she didn't need she'd send back and they'd pick up the tab. In a low margin business like selling cheap clothes I can't see how they can make money with such generous terms. She only used them because they were cheap, not because she thought it was cool to shop online at the The Iconic.

This says it all. A small group of people who are too lazy to price compare or shop around are using their site, no one else is.



They're spending about $70 acquiring each new customer. If they're not returning then you need to sell a lot of throw cushions to get your money back! And that goes back to the heart of the problem: Spending lots on advertising will get you eyeballs and sales, but to really generate repeat business you have to be offering punters something they can't get elsewhere. Competing on price on the internet is bloody tough.

 

[prawn_86]

Great discussion by 2 of ASF's best

 

[greggles]

Breakout for Temple & Webster today after their FY18 financial results reported that they are finally profitable with an EBIDTA of $300,000 in H2FY18.

The TPW share price stuck its head above resistance at 80c yesterday and then spiked today, finishing at its high of 98c, up 18.79% on yesterday's close.

It's definitely a positive that Temple & Webster are finally profitable, but can they maintain this profitability in the current financial year? It's tough to make a buck online but competition will only increase as more furniture and homewares businesses get online and compete directly with them.

 

[barney]

5 Bagger in just over a year … nice for holders

 

[Country Lad]

From cellar dweller to consistently higher prices. I love these companies that are a bit up and down but always seem to come up the ATHs.

Only 113.4 million shares with over half tightly held. ATH again today so everybody should be in profit, and in a mind not to sell.

 

[barney]

From cellar dweller to consistently higher prices.

Amazing turn around from 3 or so years ago …… You've gotta love (or hate) the random nature of the market ……..

Buying at the absolute lows of any Stock is often seen as stupidity, but sometimes with a little "fundamental foresight", there is actually no better place to buy ……

Note to self … You are getting soft in the last couple of years … Pay attention

Well done CL!

 

[JTLP]

From cellar dweller to consistently higher prices. I love these companies that are a bit up and down but always seem to come up the ATHs.

Only 113.4 million shares with over half tightly held. ATH again today so everybody should be in profit, and in a mind not to sell.

View attachment 98267

It’s a bizarre business with thousands of products in a category that is supposedly weak (household purchases) yet is still trending higher? [emoji2369]

 

[Dona Ferentes]

Temple & Webster seems to be going great guns; certainly a beneficiary of Covid and new online buying patterns. But is it a screamer and able to continue its merry way?

 

[Dona Ferentes]

I assume TPW has morphed from a 'buyers only' club; now it is positioned as a leading online retailer of furniture and homewares. The business runs a drop-shipping model, whereby products are sent directly to customers by suppliers. The drop ship range is complemented by a private label range which is sourced directly by TPW from overseas suppliers. The Group operates two brands namely Temple & Webster and Milan Direct. Funny mix, though: homewares and furniture.

A fund manager, Wilson Microcap, reckons it is winning through not having a physical presence and is enjoying the tailwinds of e-commerce

"With scale, Temple and Webster can improve the customer offering at a faster pace than its peers." "The long tail of products allows them to acquire customers cost efficiently and bring them onto the platform and retain them as recurring customers. Due to their model they also enjoy negative working capital, which means they can fund their organic growth with their operating cashflow easily." "Finally. and probably most importantly, it's their ability to fine tune the customer experience through offering value, offering choice and improving the shopping experience that is leading to very high customer satisfaction."

Along with Kogan, TPW seems to be benefit from changing habits. But is it a real moat, or just first mover advantage, plus building growth through skinny margins? Definitely, offering products and brands that resonate with customers, so that the customers come back repeatedly and through word of mouth tell their friends, is a key to success. Many apply, few are chosen.

Someone mentioned The Iconic earlier; how true if the advertising and other marketing spend slacks off, so does the profile and the the units shifted. And when overseas suppliers get a mention, that's China to a large extent.

 

[Dona Ferentes]

Just completed an institutional placement of A$40 million at an offer price of A$5.70 per share

but why would T&W be raising cash, as the biz is debt free?
• "Proceeds from the Placement will be used to provide Temple & Webster with the financial flexibility to pursue strategic growth initiatives taking advantage of the significant structural shift towards online shopping, including the enhancement of the Company’s digital platform and further strengthening the product and service offering"

• June 2020 has maintained the strong sales momentum, with gross sales (to the 28th) growing 130% vs pcp. Full year FY20 EBITDA will be greater than $8m.

 

[Dona Ferentes]

In FY20 TPW grew full year revenue by 74% to $176.3 million and EBITDA went up by 483% to $8.5 million, with the adjusted EBITDA margin rising from 2.5% to 5.3%.

In the period between 1 July 2020 to 19 October 2020, revenue rose by 138%. Temple & Webster generated $8.6 million of EBITDA in the first quarter, more than the entire amount made in FY20.

Temple & Webster’s CEO Mark Coulter outlines the benefits of gaining market share during the most affected COVID19 months:

The NAB online sales index suggests our category grew around 57% during the months of April to July, while we grew around 150% for the same period. We believe this is due to the increasing benefits of scale as we get larger. We are forging closer relationships with our suppliers as we become a more significant part of their business which allows us to obtain stock security, better terms and exclusive product ranges. We are also making larger investments in areas such as technology and data, brand awareness and our private label products; and we can produce more content by having more creative resources. In effect, the bigger we get, the better and strong our customer proposition becomes, which is a virtuous cycle.

12 month; daily

Apart from those drops on news 21 Oct AGM and NoNews early Nov (overweight insto piling out??) TPW is having a good lockdown .... can it continue??

( DNH )

 

[Dona Ferentes]

TPW is having a good lockdown .... can it continue??

( DNH )

Ex- growth? Market expectations excessively high?

Still only trading around the $10-12 mark although up in the last few weeks and on yesterday's results (the money was made in late 2019 and especially the six months after March 2020 Covid shock... sub $2 to > $13)

Key FY21 Highlights
• Record year for revenue, profit and customers
• Full year revenue up 85% YoY to $326.3m
• EBITDA up 141% YoY to $20.5m
• Cash flow positive year with ending cash balance of $97.5m
• Active customers up 62% YoY to 778k
• Trade and Commercial division up 110% YoY
• Q4 maintained strong sales growth YoY at 26%

There is a lot of competition for the click and pay retailers. You're only as good as your last sale (IMO)

 

[Dufferdev]

Any thoughts on this stock? It's been bashed pretty well lately

 

[finicky]

I have been looking at charts from this livewire article involving 'tips' fron Oscar Oberg. Makes me wonder about my small investments in the Wilson LICs: WAM and WAX as he is lead investment manager for both. Maybe he is trying to pump up his losers.

Investors must be really convinced of the long term growth for Temple and Webster's no bricks and mortar homewares direct 'drop and ship' business model. I see TPW are spending a lot more on advertising/marketing, wages and 'distribution' in H1FY22 compared to H1FY21. They are expecting H2 earnings to be weaker than H1.

A P/E of 81 (average FY21 and expected FY22) for a non dividend paying retail stock with a price/book of 9x for an FY21 ROE of 17%.
A $6.21 s.p for expected measly 15 cps earnings in FY24 - 3 years out! I should say source is analysts that CommSec uses.
Earnings for FY22 expected to be worse than FY21 by the company's own H1 report.

Another dour chart. I'm seeing it as a completed triple top, neckline at $8 or $9, conceivable target of $4-$2

 

[Miner]

I have been looking at charts from this livewire article involving 'tips' fron Oscar Oberg. Makes me wonder about my small investments in the Wilson LICs: WAM and WAX as he is lead investment manager for both. Maybe he is trying to pump up his losers.

Investors must be really convinced of the long term growth for Temple and Webster's no bricks and mortar homewares direct 'drop and ship' business model. I see TPW are spending a lot more on advertising/marketing, wages and 'distribution' in H1FY22 compared to H1FY21. They are expecting H2 earnings to be weaker than H1.

A P/E of 81 (average FY21 and expected FY22) for a non dividend paying retail stock with a price/book of 9x for an FY21 ROE of 17%.
A $6.21 s.p for expected measly 15 cps earnings in FY24 - 3 years out! I should say source is analysts that CommSec uses.
Earnings for FY22 expected to be worse than FY21 by the company's own H1 report.

Another dour chart. I'm seeing it as a completed triple top, neckline at $8 or $9, conceivable target of $4-$2

View attachment 139019

View attachment 139020

randomly search gave me TPW and noticed the last posting from @finicky suggested (sorry if I misread) suggested " it as a completed triple top, neckline at $8 or $9, conceivable target of $4-$2"
I am wondering where the triple top lead to as the current price is $6.35 on previous trading day.
DNH

 

[finicky]

Hi @Miner I maintain my interpretation of the TPW chart. The rally and retracement (5 weeks in all) has not done enough to change my opinion. Where I would start to waiver is if the price moves outside the downtrend resistance line. All the rally did was test and confirm downtrend resistance in my view. If this were to change next week say, the price would have to move convincingly above somewhere btw 6.50 and 7.00 - let's say above 6.65. As always, it's just my subjective view and I liken it to reading a horoscope. Still, I do use a chart in all my own transaction decisions.
The positive signs seem to be the RSI has moved above its downtrend and the MACD has narrowed from an exceptionally depressed level. Also volume has trended down which strikes me as selling pressure relenting in a downtrend. Also it has not yet made a lower low since the 2 week rally.
I am not following TPW but I will try to remember to check the chart occasionally to see if my picture significantly changes. Is this a buying prospect for you?

Not Held

Weekly

 

[Miner]

Hi @Miner I maintain my interpretation of the TPW chart. The rally and retracement (5 weeks in all) has not done enough to change my opinion. Where I would start to waiver is if the price moves outside the downtrend resistance line. All the rally did was test and confirm downtrend resistance in my view. If this were to change next week say, the price would have to move convincingly above somewhere btw 6.50 and 7.00 - let's say above 6.65. As always, it's just my subjective view and I liken it to reading a horoscope. Still, I do use a chart in all my own transaction decisions.
The positive signs seem to be the RSI has moved above its downtrend and the MACD has narrowed from an exceptionally depressed level. Also volume has trended down which strikes me as selling pressure relenting in a downtrend. Also it has not yet made a lower low since the 2 week rally.
I am not following TPW but I will try to remember to check the chart occasionally to see if my picture significantly changes. Is this a buying prospect for you?

Not Held

Weekly
View attachment 140538

Thanks mate

 

[finicky]

One of the bigger down moves today.
Price has gapped down, could hardly be a worse loking chart at this point; might undo all its post covid rally?