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- 4 October 2012
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- 3
I bet the Petbarn people don't see it that way.. They said they won't sell until after FY14 results are out. I wonder where the SP will be by then.
Well I cannot see into the future but what I can see presently is that the stock has risen (in the past year) by just more than 140%. However more than doubled in price since this time last year, the P/E is nearly 40 suggesting it is getting very expensive.
16/06/2014
Today Greencross has advised it has agreed to acquire 100% of the equity in City Farmers, an Australian store with 42 outlets Australia Wide, including 21 in WA.
To be funded through fully underwritten equity raising, a placement to the vendors and a drawdown from a resized debt facility.
The aquisition is expected to be completed by the 17th of July 2014.
I prefer the City Farmers outlets compared to the Petbarns so hopefully they'll keep them seperate
A problem with GXL's Vet acquisition strategy is that they're buying small practices where the owner (and frequently the owners spouse) work long hours at less than market rates. It's a calling, a lifestyle and an obsession. For vets, selling out to GXL is a fabulous exit opportunity. No more working 80 hrs while being paid for 40. Yay!
But there's a big difference between putting unpaid weekend hours into your own business versus someone else's.
Seems to me it's likely the financials of the practice will steadily erode once GXL buys it, the prior owner banks his cheque and eventually wanders off.
Geeze they stuffed that raid up. Got 2.3% after looking for 15%... Should have nibbled on market for a few days
Not sure I really understand what private equity could achieve with this business?
It's already pretty highly leveraged (around 3x EBITDA - based on 2015 earnings and debt).
I assume the vet business & pet shop businesses have pretty high fixed costs, so cutting them too deep might end up being a disaster (or not possible at all).
Not sure they could create synergies easily with an overseas business they already own either due to the geographic distance and the business model itself (although it may be possible for EBOS in New Zealand). This is especially the case for the Vets business, as most centres by their very nature are pretty decentralised, and I suspect it'd be hard to add much value in the distribution channels.
Any ideas?
interesting announcement today
they team up to buy this baby cheap and screw retail holders.
so they team up with founder and various willing parties and form a separate entity to bid for GXL
I assume these willing parties will have an economic interest in this new entity
so they have the upside but current holder get none.
it ain't going to fly I dont think, they need to bid north of $8 for anyone to seriously consider
especially long term fund managers.
I got in between 4 and 5 but I aint selling for less than $8, I just got some more today at $6.50
I think the floor price has been set around around $6 regardless of what is happening for the next
6 months at least.
Another decent result, exactly how I like it, reducing debt slowing, fund expansion via cash flow and margin increase
Another long term hold but the market doesnt agree with me
I had to dig a bit to find what explain the large differences between reported and statutory NPAT....and they thought they'd hide this on the last page of the presentation as appendix.
View attachment 67849
With the exception of the $2.7m acquisition and defence costs... it's hard to tell if the other costs are should actually be excluded from "underlying" performance?! Terms like integration and restructuring costs are such generic accounting bucket for unwanted costs...
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