Australian (ASX) Stock Market Forum

KGN - Kogan.com Limited

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UnicornHunter_8570 said:
KGN, falling under 12, who is with me?
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Matthew Kidman (Livewire Markets) : Chris, we are all at home, we’re all buying electronics, fridges, lounges, whatever you want, and you can definitely get all that stuff at Kogan. But it’s been out of favour, too much inventory recently. Buy, hold or sell?

Chris Stott (1851 Capital ) : Sell again. We think they’ve still got inventory issues that will remain for a little while longer, perhaps longer than what people are expecting. They’re cycling higher comps, benefiting at the moment from being locked down, but as soon as the economy reopens, their comps should normalise back down. So sell.

Matthew Kidman (Livewire Markets ) : James, this stock has virtually halved. It was a market darling, and it’s halved – and it’s still falling, even after the result. Buy, hold or sell?

James Gerrish (Market Matters ) : I think it’s a buy, Matt, at around $11. Obviously, they stuffed up in FY21. There’s no doubt about it. They got too bullish on the demand for their products. And when you have a heap of inventory, it’s hard to store it, it costs money, and they’ve obviously had to try and move it through sales. So, I think that’s a lesson for them. And I think going out into ’22, that aggressive stance towards growth will eventually pay dividends. So, it’s a buy at these levels, at around $11.
 
Kogan told the market on Wednesday in its latest update that it had overcome its overstocked issues from the closing months of the 2020-21 financial year after it had overestimated demand and stocked up on too many TVs, phones and other consumer products.

The overstocked position saw a sharp selloff in the already weak share price as investors wondered if Kogan had fallen victim to its success and hype as an e-tailer.

Kogan said on Wednesday it had resolved its previous inventory pressures, closing a number of “inefficient” overflow warehouses, cutting down on its inventory levels and warehousing costs.

Kogan said the size of its inventories (in warehouses and in transit) are down by around $30 million to $194 million at the end of the quarter from $228 million at the end of June. Gross sales rose 21% to $330 million but the gross profit fell 1.7% to $52.5 million which was up 31% from the June quarter. The number of active customers jumped to 3.35 million, a rise of nearly 31%

“When it comes to delighting our customers, we set a very high standard for ourselves, and I am proud of the way the Kogan team has continued to deliver on our mission of making the most in-demand products and services more affordable and accessible,” CEO Ruslan Kogan said effusively in the update.
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“While overcoming many challenges, the Kogan team has continued to deliver strong growth while investing in the future of the business and incubating new ways to deliver more value to our customers over the long term.”
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.... hype being the operative word

(DNH)
 
Article in this week's AFR quoting a gun short seller hinting at an on-line retailer in his sights.
This must surely be it.
Flight Centre is the number one shorted stock on the market, at the moment ( 12 % shorted ) . Kogan.com is not too far behind in 6 th spot with just under 9 % of its shares out on loan to the horror- heads.
 
I'm looking at the 3 year chart, today's drop, results, which look ok to a muppett like me...

So I'm wondering, what gives?
Is Ruslan being sanctioned for being born in Belarus? ?

Any thoughts on results?

Screenshot_20220225-140229.png
 
for a starter , no div. being paid this half

that being said i added more today slightly below $5 , time proved i could have got a better discount this morning
 
ANOTHER potential factor is KGN MIGHT be close to being booted from the major indexes ( XJO , or XKO , obliging some ETFs and LICs to sell )

please take care
 
“Over the coming year, the company will be recalibrating its organisational costs in line with current growth levels to support a return to the historical operating margins previously generated,” Mr Kogan said.
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what that means is; "We're carrying too much stock, and sales are slipping."
  • The number of active customers across the entire business was up 3.6 per cent to 4.1 million customers in the March quarter compared with a year ago.
  • Gross profit fell 11 per cent to $41 million, and
  • Gross sales were 3.8 per cent lower at $262 million.
  • Adjusted EBITDA; the overall business made a loss of $800,000 in the March quarter. The Kogan.com e-commerce unit made a loss of $3.5 million at an adjusted EBITDA level, but this was partially offset by the Mighty Ape business in New Zealand which made a profit of $2.8 million.
Now $4, was $25 once upon a time.
 
yes am considering IF i should add more ( say in the $3.90-$3.95 range )

i expect this to struggle a little ( or a LOT ) more .. BUT has formerly been volatile enough to wonder if a cash rescue trade ( 'free-carry ' ) is possible as well

will rising costs be an ally to KGN ( as many rivals have large infrastructure )

DYOR

i won't quite call KGN a 'safe-haven ' play more a contrarian play ( in a troubled retail world currently ) ( a not that dirty shirt in the dumpster .. still a train-wreck if naked becomes the fashion )
 
KGN seems to have joined the trend that many of the US tech stocks have already been in....

Are they still planning to pay a dividend?
 
i didn't see a mention of that

NORMALLY you would think NOT ( this year ) any extra cash being devoted to expansion , streamlining the business , etc etc

but two directors also hold more than 1 million shares each , would they be content to just survive on their salary this year
 
Kogan.com amends Debt Facility
Reduces facility limit to $55.0 million
Kogan.com Limited (Kogan.com; the Company, ASX:KGN) today announces that it has
amended its multi-option facility agreement with Westpac Banking Corporation (Debt
Facility), with no change to the existing term of three years to 31 January 2024. The
amendment sees a reduction in the facility limit to $55.0 million (including an associated
reduction in line fees) with the next covenant testing to be 31 December 2022.
Other than the amendments noted above, the material terms of the Debt Facility remain as
detailed in the Prospectus dated 24 June 2016 and as further described in Kogan.com’s
subsequent announcements to the ASX on prior renewals and amendments of the Debt1
Facility.
The Company anticipates having no net debt (drawn bank debt plus total cash) at financial
year end.
Authorised for release by the Board of Kogan.com Limited.

i hold KGN ( and a trivial amount of WBC )
 
Kogan.com Business Update
Kogan.com Limited (the Company; the Business Kogan.com; ASX: KGN) is pleased to announce
another year of record Gross Sales and the return to positive quarterly Adjusted EBITDA in 4QFY22
1
following successful ongoing recalibration of operating costs.
Founder and CEO of Kogan.com, Ruslan Kogan, said:
"Times are changing. In uncertain times, people don't want to alter their lifestyle but they
are happy to shift the way they shop. We know that in an environment where great value
becomes even more important, Kogan.com serves an important need.
"Our Business was built for this. Efficiency and speed has been at the core of how the
Kogan.com team operates for 16 years now. We're honoured that there are millions of
Active Customers in the Group that have seen the value we provide. When the Australian
public was asked to vote for their favourite online retailer, Kogan.com was voted the
Australia Post ORIAS People's Choice Retailer of the Year for the sixth year in a row. This is
perfect validation of the value we create for the people that matter most - our customers.
"We're not resting on our laurels though. We are making the Business leaner to enable us
to pass on cost efficiencies to customers in the form of lower prices. A leaner company
means we discontinue parts of the Business that are not delivering value to customers or
shareholders, and also gives us the flexibility to respond to significant ongoing changes in
the macro environment."
The Company provides the following update which, where applicable, is based on unaudited
management accounts as at 30 June 2022. The update compares the FY22 results to FY21 and also
2
FY20:
● Gross Sales grew by 0.1% above FY21, and a CAGR of more than 23% since FY20
3
● Gross Profit declined by 9.4% below FY21, however a CAGR of more than 20% since FY20
● Adjusted EBITDA was $19.1m for FY22
● Group Active Customers
4 grew to 3,972,000, with Kogan.com Active Customer CAGR of 21%
since FY20

● Kogan First members have grown by 210% since FY21 to over 372,000
● As at 30 June 2022 the Company increased the net cash position (total cash less drawn debt) to
$31.2m, from $12.8m at the end of FY21
● Total inventories were $161.1m, with $139.2m in warehouse and $21.9m in transit. This reflects a
significant unwinding of inventories from total inventories of $227.9m at the end of FY21


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DYOR

i hold KGN

am not sure how the market will take this , but if it dips enough , i will nibble some more
 
one comment from a fund manager looking for opportunities to short a stock, and
... looks for instances of executives having audit committee duties, which he deems to be a weak link in the chain of governance. Kogan, according to him, navigates similar territory where the CEO has attended every single audit meeting.
"This is hardly the model of good governance,” he said.
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  • revenue down 8%
  • adjusted net profit 2021 was $42 million, net loss 2022 at $2.9 million
  • no final dividend
The future of online shopping is undiminished.
“The opportunities for us are endless,” Ruslan Kogan declared.
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1661250114276.png

"Climb every mountain
Ford every stream
Follow every mountain
Don't you ever give up, no ohh
Climb every mountain
There's a brighter day on the other side
Follow every rainbow
'Till you find your dream."
 
Dona Ferentes said:
one comment from a fund manager looking for opportunities to short a stock, and
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having worked in several warehouses/distribution centres , the learning curve can be surprising , especially for a rapidly expanding business ( with new products coming in irregularly ) , one place specialized in electronic components and tapes ( video, audio and data )

so the fund manager could easily be fair ( in the criticism ) but opportunistic

i will certainly CONSIDERING adding more KGN if it goes under $3

but KGN MIGHT have to bring in some extra EXPERIENCED staff to cope ( increasing costs )
 
** “The opportunities for us are endless,” Ruslan Kogan declared. **

a BIG difference between opportunities and deliveries , chances are management will have to acquire skills in logistics ( which is NOT impossible if willing to learn , relying on out-sourcing can be a total disaster )
 
January 2023 Business Update
Kogan.com ends the period with a strong cash balance, having substantially
right-sized inventory levels
Kogan.com Limited (the Company; Kogan.com; ASX: KGN) is pleased to announce
significant progress in the sell-through of excess inventory during the half, having
reduced inventory in-warehouse by 39.0% since 30 June 2022. The reduction in inventory
levels supported growth in net cash (after loans & borrowings) to $74.0 million, after
having funded the Mighty Ape Tranche 3 payment ($14.2 million), repaid loans &
borrowings of $25.0 million and successfully acquired Brosa
1
. The half also saw Kogan
First subscribers
2 grow to 404,512 by 31 December 2022 (47.6% growth YoY) and Kogan
Mobile Australia reach the most ever Active Customers in its history (4.2% growth YoY).
The half did, however, reflect subdued sales activity for the Company, whilst cycling a half
in the prior year that was impacted by COVID-19 lockdown orders. During the half, the
Company focused on selling through the final balance of excess inventory which
involved unprecedented discounting for customers, impacting Gross Profit and Gross
Margin. The reduction in inventory did result in reduced operating costs, across both
warehousing and marketing.
Having now cleared through the bulk of this excess inventory, the Company will continue
optimising operating costs and streamlining the Business to return to the levels of
operating margins previously delivered prior to the COVID-19 pandemic. The Company
expects gross margins to improve from January 2023, and to further optimise operating
costs progressively through the second half of the financial year. The Company looks to
2HFY23 with confidence in its ability to return to an agile, nimble and inventory-light
business that achieves strong operating margins and profitability.
2 Excludes Kogan First customers who are in a trial period, and includes only non-trial subscribers.
1 For details on this transaction, please refer to the ASX announcement ‘Kogan.com acquires Brosa’ released on
22/12/2022.
Founder and CEO of Kogan.com, Ruslan Kogan, said:
“The impacts of inflation and interest rates have begun to affect the lives of
Australians and New Zealanders. We’ve been growing Kogan.com for more than 16
years now, so we’ve been through many cycles and we know that when customers
are watching their costs carefully, ecommerce becomes even more important.
Since Kogan.com launched out of a garage in 2006, we’ve been obsessed with
making the most in-demand products and services more affordable. We are proud
to be making that possible for our millions of customers and the growing base of
loyal Kogan First Subscribers.
We are also proud and excited to have added Brosa to the Kogan Group,
expanding our share of the online furniture retail market. Along with our
acquisition, we are now looking forward to welcoming, delighting and delivering
great value to the 500,000 Brosa customers, as we relaunch the brand in the
second half of the financial year.”
The Company provides the following update which, where applicable, is based on
unaudited management accounts for 1HFY23. The update compares the 1HFY23
management accounts to the audited 1HFY22 results, unless stated otherwise:
● Net Cash (after loans & borrowings) grew to $74.0 million as at 31 December
2022. This result was achieved after having funded the Tranche 3 payment in
respect of the Mighty Ape Acquisition of $14.2 million, repaid loans & borrowings
of $25.0 million (with a remaining balance of $10.0 million at 31 December 2022)
and payment of the Brosa acquisition purchase price of $1.5 million, during the
half.
● Inventories reduced to $98.3 million (comprising $84.1 million in-warehouse and
$14.2 million in transit) as at 31 December 2022 from $159.9 million (comprising
$137.9 million in-warehouse, and $22.0 million in transit) as at 30 June 2022.
● Group Active Customers
3 were 3,323,000. Kogan.com ended the period with
2,550,000 Active Customers and Mighty Ape had Active Customers of 773,000.
● Kogan First members grew 47.6% YoY to 404,512 as at 31 December 2022.
● Gross Sales of $471.1 million declined 32.5% YoY. Performance was impacted by
soft trading conditions and the cycling of a period in the prior year impacted by
COVID-19 lockdown orders.
● Gross Profit of $62.9 million was impacted by soft topline performance
mentioned above along with significant discounting to clear through the bulk of
excess inventory.
● Operational Cost efficiencies continued to be achieved during the half, as excess
inventory reduced. Variable costs as a percentage of Gross sales reduced to 7.6% in
1HFY23 from 8.5% in 1HFY22.
● Adjusted EBITDA
4 was $(4.4) million. EBITDA was $(23.0) million.
● Adjusted EBIT
4 was $(12.7) million. EBIT was $(31.3) million.

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DYOR

i hold KGN

am not sure how the market will take this , but if it dips enough , i will nibble some more

will be looking for a price very close to $3 ( or less )
 
divs4ever said:
will be looking for a price very close to $3 ( or less )
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am still waiting/watching for that price

i see still more pressure on the average consumer , and Kogan's lower price goods and services might receive a boost

after their ambitious but painful expansion in 2020/2021 hopefully lessons have been learned , and if you believe the 'conspiracy websites ' i read another virus pandemic is possible ( to distract from other current crises )

i was still watching healthcare related stocks in preference to KGN but they are drifting away from target prices

and so KGN is my tip for the September competition , but without a high degree of anticipation of buying my tip this month

good luck in the comp. every one
 
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