Morningstar

Morningstar, Inc.

Equity Bottom-Up

First-quarter sales growth at the Red Sheds, Blue Sheds, and Noel Leeming is tracking ahead of our full fiscal year 2019 estimate, and gross margin at the Red and Blue Sheds is improving. However, in anticipation of the crucial Christmas trading period, we maintain our near-term forecasts and our NZD 2.40 fair value estimate on no-moat rated The Warehouse Group.
Analyst: Johannes Faul, CFA

No-moat-rated The Warehouse Group is set to continue its transformation for another two years with investments in its online channel, both in digital and fulfilment, as well as refurbishing its existing physical store network. We now expect fiscal 2019 capital expenditures to increase by some 30% to NZD 90 million, with additional one-off operating expenses of NZD 25 million. These higher near-term expenses are offset by the positive impact of the time value of money, and our fair value estimate…

For the first half of fiscal 2018, no-moat-rated The Warehouse Group reported underlying net profit after tax of NZD 35.8 million, adjusted for restructuring costs relating to the ongoing transformation of the group and a one-off accounting adjustment. This is slightly above company guidance of NZD 32 million-35 million provided in early January 2018, but sales were weaker than we expected. Our long-term forecasts are unchanged, and we maintain our fair value estimate of NZD 2.40.
Analyst:…

No-moat-rated The Warehouse Group reported first-quarter fiscal 2018 group sales of NZD 645 million, a 1.7% decrease on the prior corresponding quarter, significantly affected from the transition to everyday low pricing, or EDLP, at its core Red Sheds business, as well as the clearance of discontinued lines. We trimmed our valuation to NZD 2.40 per share from NZD 2.50 following weaker-than-expected sales growth; however, shares are trading at a 12% discount to our intrinsic assessment at current…

Fierce competition in the retail sector has taken its toll on The Warehouse Group and is a setback to the performance stabilisation achieved in recent years. We have lowered our fair value estimate by 4% to NZD 2.60 per share from NZD 2.70 per share. We maintain our no-moat rating on The Warehouse Group, which operates in a tough competitive environment, experiencing an influx of international players establishing physical stores in New Zealand, as well as an increase in online competition.
The…

New Zealand

The Warehouse Group Limited operates general merchandise and stationery supply retail stores throughout New Zealand.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00