Value has been shifting this week. The commercial real estate sector received another setback from a landmark ruling in connection with the restructuring of

Expectations on New Look:

- The company informed suppliers it will cancel all SS orders and will delaying payment for any supplies in transit or already accepted until further notice.

Clearly that would be a significant shift of wealth from landlords to retailers and of market/government focus vice versa. Perhaps it is time to position for that in the very short term (today).

Boris Johnsn’s order to close shops has come just in time for retailers. British Q2

Below is an account of each of the names we follow and have begun work on in the context of Covid19 and Oil prices. Several names stand out as having become either uninvestible or outright attractive - already now.

Apparel retail remains under pressure.

ABF reported on Monday that Primark was seeing LfL sales down 1.3%. In contrast to other retailers however, Primark had reported

Since receiving data from other retailers incl. Matalan, performance was expected to be dismal, but on the bright side

Primark this morning provide a positive read-across for our positions in Matalan, New Look and Douglas.

The brick&mortar high-street retailer reported of only

Q4 UK apparel retail appears to have done better than in the first 9 months. 

NEXT Plc’s Retail Sales growth of -3.9% in Q4 compares to an average of

Next PLC have been reporting a further slow-down in their Q3 to October 26th. We will stick with our Matalan position and feel somewhat stuck with our New Look position.

Implications:

Following news that John Lewis is seeking discounts from landlords, the Sunday Telegraph reported that Mike Ashley is to shut down most of HOF’s stores after

Ted Baker’s numbers were thought the end of August. While that is 4 weeks further than the last numbers we have from New Look, NL management said

Some take aways from New Look’s call today:

- Clearly the retail environment is tough on every player (except Zara), not just New Look.

- Management are executing the changes that were advertised, even if we felt that some

We knew tis was going to be a challenging quarter, but there is simply very little gloss to put on New Look’s results through June.

Results:

A stroll down the high streets of west London alone confirms the dire state of British retail. Shop fronts remain boarded up for years now, clearly unable to find a tennant in a market with static supply and ever decreasing demand

As per my mail a week ago, even ASOS are struggling in this UK retail environment. But not as much as we expected.

Away from its automation issues in Europe and slow brand stocking in the US,

Further to our work on New Look and Matalan in recent days / weeks, the Retail Gazette writes it was the “worst June on record”, with total sales down 1.3% in June 2019 vs +2.3% comp. Overall LfLs were -1.6% vs

Just a thought this morning on the news that TUI have opened a shop inside Next in Sheffield.

What if Thomas Cook, Pizza Express and New Look moved together?

The negative stream of news from the UK high street continues as Jamie Oliver’s restaurants enter administration and Philip Green closes 23 of his stores. Between Burton, Dorothy Perkins and Top Shop it will be close to 200 stores altogether. 

Pizza: As the CVAs are queueing up,

Moody’s have rated New Look Caa2 with a review for a further upgrade.

The agency expects further cost and thus leverage reduction throughout the year. We concur

Continued negative news for British retail - including our anti cyclical positions in New Look, Matalan and to an extent Iceland.

New Look have completed their balance sheet restructuring.

The new model for New Look is here on the website, along with a 2 pager based on the core business from here. For a deeper dive on the company as of

New Look: CDS has once again taken a restructuring process for a ride. New Look is having to implelent its restructuring via a formal pre-ack Scheme Of Arrangement as opposed to a

Following the Polish subsidiary a few days ago, the French business has entered administration as well. 

We are expecting a similar turn of events for the

New Look have opted for an insolvent wind-up of their polish business. 

The company previously had officially called time on the

All,

Its been a busy week for retail. 
- Debenhams, who had come out with further reduced guidance and the need for a comprehensive restructuring earlier this week , prompted the latest twist

Further regarding New Look and Matalan today: LK Bennett have entered administration.

Confident note on their website:

Quiz Group have released another profit warning today. 

The company are a small and quite differentiated competitor to New Look, focussing on glam formalwear and international presence.

… I had already committed the John Lewis news to memory. 

The results are relating to the period ending January