Douglas - Modelling for elasticity

Please find our updated analysis here.

Much around Douglas has changed since last year. The highly indebted refinancing last year had come at the height of the market and was predicated on an online-infused IPO story that’s since returned to the Hut it came from. What’s more, inflation is now squeezing consumer wallets, it’s German home market has posted poor numbers and the online division has had to take a step back YoY. But not all is bad. The SOP program has been a success and the affordable luxury market is once again showing signs of holding up better than other retail sectors. We also think it’s key to understand the company’s supply side. So having expanded our model to reflect these new realities, how does the company behave over the next 12 months and what will be thereafter?

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Wolfgang FelixDOUGLAS
Boparan - timing is art of delivery.

Please find our updated analysis here

We are wearily familiar with the challenges that Boparan faces in its relationship with its customer base. The recovery of previously incurred inflationary costs in Fiscal Q3 has supported the liquidity position of Boparan. Long term we need to see a pricing system that is: 1. Comprehensive and 2. Timely. The urgency here is only exacerbated by the impact of the war in Ukraine on costs, as price rises flow through to consumers and there will be some volume drag as consumers balance the higher cost of their weekly shop against the absence of cheaper protein sources.

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Aengus McMahonBOPARAN
Adler - Interpretations, next steps and events

Please find our unchanged analysis here.

The formalisation of Bafin’s investigation is perhaps not the most shocking news. We have been discussing implications for a while and it’s been a feature in our positioning decisions, but it’s worth reasoning through the structure of BAFIN's involvement to make sure we aren’t missing anything major. Meanwhile, Consus are delisting their shares just in time for the 9-month deadline from year-end.

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Wolfgang FelixADLER
KME - comment

We noted on the Q122 conference call that KME management expects to announce in Q3 how it is going to refinance the outstanding €110m SSNs (maturing in February 23). We are

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Aengus McMahonKME
Tullow - comment

In conversation last week with clients the issue of the legality of a proposed dividend for the new Tullow/Capricorn entity was discussed. For clarity, if leverage is below 1.5x, which is likely if the merger completes, there are limited

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Tomás MannionTULLOW
Takko - Recap Model - Positioning

In light of the current state of the market, the methuselahmic sponsor of 10 supportive years, cost pressures all round, disposable income concerns, Takko are again worth sharpening our pencils for. To be sure, Takko have performed admirably throughout the pandemic, even when considering the fresh cash injection last year. But the debt pile it has been carrying so lightly in years gone by is now becoming very very heavy. We have been toying with a recap model and have extended our forecast to take more of an owners’ view of the name.

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Wolfgang FelixTAKKO
Iceland - comment

Tesco released its Q1 numbers this morning, and the CEO is quoted saying “we are seeing some early indications of changing customer behaviour as a result of the inflationary environment. Customers are facing unprecedented increases in the

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Tomás MannionICELAND
Casino - comment

A couple of announcements were released from Casino this morning with Casino extending their partnership with Gorillas to include the Frichti platform. More importantly, Casino also announced the simplification of its corporate structure by regrouping all its

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Tomás MannionCASINO