Archive | The Warehouse

The Warehouse reorganises

The Warehouse Group Ltd announced a series of changes to its business operating model on Tuesday.

Group chief executive Nick Grayston said the changes were designed to drive an improvement in financial performance and generate greater customer relevance as customer needs change and competition increases.

“Changes will focus primarily on simplification to reduce complexities, drive efficiencies and increase business agility, while removing significant cost.

“We will implement a series of operating model changes in the coming months, including:

  • strengthening & consolidating the various group support service functions to drive synergy benefits, deliver efficiencies and reduce complexity across all group brands
  • combining The Warehouse (red sheds) & Warehouse Stationery (blue sheds) by integrating their operating structures & executive leadership. This will also occur for Noel Leeming and Torpedo7 Groups.”

Mr Grayston said that, after the decision to change the scope of the role of the brand chief executives, The Warehouse Ltd’s chief executive, Simon Turner, had decided to leave the business.

Mr Grayston said Mr Turner had refocused The Warehouse brand over the last 4 years, achieving 16 quarters of positive sales growth: “Under his leadership, The Warehouse has been recognised as one of the best places to work in New Zealand and, as such, Simon is much admired & respected within The Warehouse Group. Simon has a wealth of international retail experience and I know he will approach his next venture with the same passion & commitment that he has shown at The Warehouse.”

Pejman Okhovat, chief executive of Warehouse Stationery & Torpedo7 Group, will lead The Warehouse & Warehouse Stationery brands. Tim Edwards, chief executive of Noel Leeming Group, will lead both Noel Leeming & the Torpedo7 Groups. Mr Okhovat joined The Warehouse Group in 2005 and Mr Edwards has been with Noel Leeming Group since 2009.

The Warehouse will outline further detail, associated costs & benefits in its half-year report in March.

Attribution: Company release.

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Propbd on Q T2Feb16 – DJ’s settles, third Melbourne Ryman, Fletcher sells Rocla assets, Warehouse opens at Atrium, ethics consultation

David Jones settles Kirkcaldie’s deal
Ryman buys third Melbourne retirement village site
Fletcher nets $85 million from Rocla divestment
Warehouse moves to Atrium on Elliott
Ethics standards for property sector out to global consultation

11.25am:
David Jones settles Kirkcaldie’s deal

David Jones Pty Ltd has settled its agreement to take assignment of Kirkcaldie & Stains Ltd’s main store lease on Lambton Quay in Wellington and to pay $A400,000 cash for the name ‘Kirkcaldie & Stains’.

Kirkcaldie & Stains is still awaiting High Court approval of a scheme of arrangement to return $19.4 million of capital to its shareholders. The company is seeking court approval to cancel 4 in 5 of its shares and return $2.3602/share cancelled. It also wants to wind up the employee share scheme.

The David Jones store would be the first for the brand outside Australia, but brand owner Woolworths Holdings Ltd’s 36th store in New Zealand. South African retailer Woolworths Holdings acquired David Jones in August 2014 for $A2.1 billion. Its other brands here are Country Road, Witchery, Trenery & Mimco.

Ryman buys third Melbourne retirement village site

Ryman Healthcare Ltd said yesterday it had bought its third retirement village site in Melbourne’s eastern suburbs.

The New Zealand company will redevelop the 2.5ha site in Burwood East into a $200 million ($A183 million) retirement village for over 400 residents, with independent living apartments & an aged-care centre which will include specialist dementia care. The new village will also have a swimming pool, café, gym, beauty salon, library, movie theatre & bowling green.

Ryman has entered into an unconditional contract to buy the site, which is part of a Frasers Property Australia redevelopment of the 20.5ha former Burwood East brickworks.

Frasers Property Australia has plans for a $A500 million-plus redevelopment of the site, which will include 900 homes and a large retail centre.

Ryman opened its first Australian village at Wheeler’s Hill in Melbourne’s eastern suburbs in 2014 and is developing a second village at Brandon Park. Managing director Simon Challies said Ryman’s in-house team would design the new Burwood East village, and the company intended to apply for planning permission in late 2016.

Mr Challies said the Burwood East purchase put Ryman on track to fulfil its ambition of opening 5 villages in Melbourne by 2020.

Fletcher nets $85 million from Rocla divestment

Fletcher Building Ltd said on Friday it had completed the $A150 million divestment of Rocla Quarry Products assets to Hanson Construction Materials Pty Ltd, following clearance from the Australian Competition & Consumer Commission and Foreign Investment Review Board.

In addition, Fletcher said it had sold Rocla assets excluded from this transaction to other parties for an extra $A44 million.

Fletcher said it would make an $A77 million ($NZ85 million) after-tax profit from the Rocla sales, less transaction costs & adjustments to asset carrying values.

This transaction doesn’t affect the ownership of Fletcher Building’s Rocla Pipes & Concrete Products or GBCWinstone businesses, which remained core elements of its portfolio.

Warehouse moves to Atrium on Elliott

The Warehouse Group Ltd has secured a long lease in the Atrium on Elliott for an 1800m² store to replace its second-floor premises in the Downtown Shopping Centre, which Precinct Properties Ltd will demolish to make way for its new Commercial Bay development.

The Atrium on Elliott shop opened last week and the Downtown shop will close in May.

The Atrium on Elliott is a 14,000m² 4-level enclosed shopping centre & food court at the base of the Crowne Plaza Hotel & BDO Tower.

Alison Laity, director of Atrium owner Colwall Property Ltd, said: “Having the Warehouse opening alongside existing large-format retailers Rebel Sport & No 1 Shoe Warehouse has greatly boosted our leasing inquiry. We just wish we had more space to lease. Currently we have limited opportunities available within the centre, and we expect these to be snapped up quickly – especially with the impending closure of Downtown shopping centre.”

Ethics standards for property sector out to global consultation

FIABCI (the International Real Estate Federation) has won the support of 63 land, property & construction professional bodies & standard-setting organisations for a global consultation on ethics principles.

The international ethics standards coalition launched its consultation document this week and will close the consultation on 30 April.

Link:
Consultation document

Earlier story:
19 August 2015: International ethics standards coming for real estate professionals

Attribution: Company releases, FIABCI.

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Propbd on Q W20May15 – Warehouse bonds, Infratil result

Warehouse completes bond bookbuild and sets interest rate
Infratil lifts earnings and prepares for more growth

Warehouse completes bond bookbuild and sets interest rate

The Warehouse Group Ltd’s issue of unsecured, unsubordinated, fixed rate bonds has been oversubscribed. It’s reserved $100 million for clients of participants in the bookbuild process who have received firm allocations in the general offer, including $25 million of oversubscriptions.

The general offer opens today and is scheduled to close on Wednesday 10 June.

The exchange offer to holders of maturing bonds resident in New Zealand, which is for up to $25 million, opens today and is scheduled to close on Friday 5 June. There will be no public pool.

The interest rate has been set at 5.30%/year.

Infratil lifts earnings and prepares for more growth

Infratil Ltd said yesterday the company had succeeded in creating value for its shareholders “by any measure” in the March 2015 year. More importantly, it had also positioned itself to continue doing so.

Net parent surplus was up from $199 million to $384 million. The adjusted net surplus (excluding revaluations, realisations, one-off acquisition costs and reflecting Z Energy’s contribution on a current cost basis) was up from $39 million to $79 million.

Consolidated EBITDAF from continuing operations was up 4%, from $437 million to $453 million. Adjusted consolidated EBITDAF was up 7%, from $493 million to $526 million.

EBITDAF is a non-GAAP measure which shows management’s view of underlying business performance. It shows operating earnings before interest, tax, depreciation and amortisation and before making any adjustments for fair value movements, realisations and impairments. Adjusted EBITDAF includes discontinued operations and Z Energy’s contribution on a current cost basis, but excludes one off acquisition costs relating to RetireAustralia.

Investments totalled $508 million ($616 million), including the $219 million acquisition of a 50% interest in RetireAustralia in December 2014, Trustpower’s $200 million of investment mainly in Australian generation, $32 million invested via ASIP in Australian social infrastructure and $57 million of investment by New Zealand subsidiaries in their own activities.

The final dividend for the year is 8c/share (fully imputed) and a special dividend of 6.4c/share (fully imputed) will also be paid, both on 15 June.

Infratil has forecast EBITDAF to increase by 7-14% in the new financial year, due largely to past investment.

Link: Result details

Attribution: Company releases.

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Propbd on Q Sun10May15 – Kerr v Barnes stoush, NZF chooses cleanest exit, Warehouse bond, Warehouse Q3 sales up

Kerr presents $22 million-plus demand and Barnes rejects it
NZF board opts for voluntary administration
New Warehouse bond offer
Warehouse Q3 sales up 4.3%

Kerr presents $22 million-plus demand and Barnes rejects it

Pyne Gould Corp Ltd (headed by George Kerr, now of London) said on Friday it had demanded $22.2 million to finalise its sale of Perpetual Trust Ltd to Bath Street Capital Ltd (Andrew Barnes).

Bath Street promptly rejected the demand.

Pyne Gould said: “In addition to the consideration received by Pyne Gould at the completion of the Perpetual Trust sale in January 2014 ($12.344 million, as previously announced), the sale agreement provided for further consideration payable to Pyne Gould on the occurrence of certain corporate events. There was no floor & no cap on this further amount.

“In April 2014, Pyne Gould and interests associated with Bath Street agreed a variation providing that, in consideration for a payment to Pyne Gould of $22.2 million, the further consideration obligation to Pyne Gould under the previous arrangements would be extinguished.

“Pyne Gould’s view, based on the agreement, is that the payment is due. As it has not yet been received, Pyne Gould has now formally requested payment of the $22.2 million, plus interest & costs, from Bath Street and will pursue that.

“Pyne Gould expects to fully recover the $22.2 million. However, for the purposes of the 31 December 2014 half-year accounts, it was revalued to $19.3 million by independent valuer Grant Thornton. With Grant Thornton’s recent appointment to be Pyne Gould’s auditors, Pyne Gould will appoint a new independent valuer to consider the matter should the amount still be outstanding at 30 June 2015.”

It took a bit more work than Mr Kerr has outlined to get to that point, as you can see from my 1 February story (link below). I wrote in February from notes to Pyne Gould’s June accounts: “Receipt of the money depended on the purchasers of Perpetual Trust Ltd, Bath Street Capital Ltd & Andrew Barnes, listing the shares of a newly incorporated company on the NZX main board. The listing didn’t happen.”

While Mr Kerr said the $22 million was classified as a receivable in the June 2014 accounts, its appearance in the income statement as a gain on disposal turned it into real dollars. In January he said: “Given the current status of the outstanding amount, as at today’s date, it will be reclassified in PGC’s accounts to 31 December 2014 (due for market release by the end of February) as ‘an available for sale financial asset’.”

Bath Street said on Friday the price wasn’t set, but would be up to $22 million depending on the price:earnings multiple at which a subsidiary company was listed.

Bath Street said the subsidiary had continued to evaluate listing, but there was no timetable for this event in the agreement with Pyne Gould.

Earlier stories:
1 February 2015: PGC fesses up over conditional, non-existent profit
17 January 2014: Pyne Gould completes Perpetual sale

NZF board opts for voluntary administration

NZF Group Ltd’s board said on Friday it had resolved to initiate the process to place the company in voluntary administration.

The deal the board had hoped to use for a reverse takeover fell through at the end of April when “internet of things” company Inventory Technologies Ltd resolved not to proceed.

Chairman Sean Joyce said that, since then, the board had been considering options to expedite a timely distribution of funds to the holders of NZF capital notes.

After taking specialist advice, the board felt voluntary administration was the best course. Mr Joyce the board was discussing that with an independent specialist and a formal appointment was expected within 10 days.

Earlier stories:
29 April 2015: Propbd on Q W29Apr15 – Kirkcaldie’s loss, new levy on SkyCity, Allied Farmers placements, Argosy revaluation & sale, NZF deal falls over
11 March 2015: Inventory Technologies raises capital ahead of proposed NZF reverse takeover
7 August 2014: Propbd on Q Th7Aug14 – NZF decider lacks quorum, QV sees value slowdown, 3 apartments sell, all passed in at Barfoots

New Warehouse bond offer

The Warehouse Group Ltd announced an offer of 5-year unsecured, unsubordinated, fixed-rate bonds on Friday to refinance its $100 million senior bond maturing on 15 June and for general corporate purposes.

The retailer will seek up to $100 million, and oversubscriptions taking it to a maximum $125 million. The $75 million general offer will be open to institutional investors and members of the public resident in New Zealand, and a $25 million exchange offer will be made to NZ-resident holders of the maturing bonds.
The Warehouse expects the interest rate to be set though a bookbuild on Tuesday 19 May, in an indicative range of 5.30-5.55%/year, and the offer to open the next day.

Warehouse Q3 sales up 4.3%

The Warehouse said its third-quarter sales were up 4.3% on a year earlier, and same-store sales grew in all 4 retail categories:

  • The Warehouse (red sheds), same-store up 3.3%, total up $14.1 million (3.8%) to $381.1 million
  • Warehouse Stationery (blue sheds), same-store up 2.1%, total up $2 million (2.9%) to $70.2 million
  • Noel Leeming, same-store up 0.9%, total up 5.4% ($7.9 million) to $154.8 million
  • Torpedo7, total sales up 8.5% ($2.4 million) to $30.6 million

Overall sales rose from $610.3 million to $636.7 million (but the company dropped $1.6 million off this figure).

Attribution: Company releases.

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Propbd on Q T5May15 – Esanda for sale, inspections cancellation charge, Warehouse bond, PFI resumes DRS & ups loan facility

ANZ to sell Esanda dealer finance business
Council votes in fee for last-minute cancellation of building inspections
Warehouse considers new bond offer
PFI resumes DRS scheme and increases loan facility

ANZ to sell Esanda dealer finance business

ANZ Banking Group Ltd said today it intends to sell its Esanda dealer finance business. The bank expects to issue an information memorandum to potential bidders this month.

The sale will include about $A8.3 billion in lending assets comprising point-of-sale finance, bailment facilities & other Esanda-branded finance offered to vehicle dealers.

The bank’s chief executive for Australia, Mark Whelan, said: “The sale of the Esanda dealer finance business is part of a broader group priority to actively manage our portfolio of businesses to ensure we use capital efficiently, as well as a focus on ANZ-branded products.”

He said the bank would continue to provide asset finance for its customers under the ANZ brand, and the sale didn’t include the ANZ commercial broker, commercial asset finance or direct to consumer asset finance businesses.

ANZ bought the ASX-listed English, Scottish & Australian Bank Ltd in 1970 but chose to use this one piece of ES&A without rebranding it.

Council votes in fee for last-minute cancellation of building inspections

Auckland Council’s regulatory & bylaws committee approved setting a $135 fee (including gst) yesterday for customers for a building inspection who cancel on the day of inspection.

A staff report said: “Delivering an inspection service within 48 hours is challenging. A principal reason is the large number of inspection bookings which are cancelled on the day of the inspection. Same-day cancellations are currently running at 10% of the total number of inspection visits booked (regionally 700-800/day)…. The high level of cancellations is driven by builders block booking inspections in advance. The end result of this is that other customers are unable to book at the day/time they wish to have their inspection.”

The report said the proposal had been discussed extensively with industry representatives, including Master Builders & Certified Builders, and had been met with strong support as it would enable the council to provide inspections within 48 hours of request from well organised customers.

Warehouse considers new bond offer

The Warehouse Group Ltd said yesterday it was considering making an offer of new 5-year unsecured, unsubordinated, fixed-rate bonds to refinance its $100 million senior bond maturing on 15 June and for general corporate purposes.

The company will seek up to $100 million, with oversubscriptions taking the total to $125 million in a general offer to retail & institutional investors and an exchange offer to holders of the maturing bonds.

PFI resumes DRS scheme and increases loan facility

Property For Industry Ltd announced a first-quarter cash dividend of 1.75c/share yesterday, with imputation credits of 0.4334c/share attached and a supplementary dividend of 0.1967c/share for non-resident shareholders. It will also reinstate the dividend reinvestment scheme, which hasn’t been applied since the May 2012 dividend.

The company’s guidance for the December 2015 financial year is unchanged – distributable profit 7.35c/share, cash dividends 7.30c/share.

Joint general managers Nick Cobham & Simon Woodhams said PFI had secured a $25 million increase in its syndicated bank loan facility to $375 million and refinanced on competitive terms. The refinanced facility, provided by existing lenders ANZ Banking Group, Bank of NZ, Commonwealth Bank of Australia & Westpac, comprises 2 $187.5 million tranches, one committed for 4 years and the other for 5.

From an average term to expiry of 3.8 years and weighted average cost of debt of 5.96% at 31 December 2014, the average term to expiry has extended to 4½ years and the average cost of debt is 6.08%.

Attribution: Council & company releases.

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Propbd on Q Th23Jan14 – Allied to settle, Jeweller’s NZ sales down, Warehouse recovers

Allied to settle with Speirs next week
3-nation growth for Michael Hill, but NZ down
Strong Christmas helps Warehouse recovery

11.30pm:
Allied to settle with Speirs next week

Allied Farmers Ltd said today all conditions had been satisfied for settlement of a $2 million obligation to Speirs Group Ltd relating to a 2008 put-&-call option contract with Speirs. Settlement is scheduled for Friday 31 January.

Speirs acquires 14% of Allied as part of the deal. The Allied share price when the deal was announced in December was 3.6c. It promptly rose to 4.8c, made it up to 5.3c and was at an even half cent today.

Earlier story, 28 December 2013: Speirs gets 14% of Allied Farmers to settle 2008 deal, plans to re-enter finance sector

3-nation growth for Michael Hill, but NZ down

Michael Hill International Ltd said today it achieved 4.7% same-store growth in the December half (5 months plus preliminary December sales figures) compared to the same period of 2012. Chairman Sir Michael Hill said weakening of the $A against the other 3 currencies it trades in helped the result – the jewellery retailer announced last October it would report all its results in the Australian currency.

In local currency, Michael Hill’s Australian same-stores were up 1.4%, Canada 7.9%, the US 2%, but New Zealand fell 4.1%. Sir Michael said the New Zealand decline was “in part due to the settling in of a new retail management team mid-2013. The company is confident this decline will be reversed in the coming months. The US business performed solidly, finishing 2% up for the 6 months, however trade was adversely affected by severe winter conditions leading into the key Christmas trading period.”

The company will release its full half-year results on Friday 14 February. It’s expecting ebit to come in at $A29-30 million, up from $A28.6 million last year.

Strong Christmas helps Warehouse recovery

The Warehouse Group Ltd said Christmas trading across the group was strong, but wouldn’t fully offset the Red Sheds’ first-quarter margin issues.

Group chief executive Mark Powell said Red Shed sales were expected to be up 4% for the half and total sales up 5%, returning second-quarter gross profit margins to the previous year’s second-quarter levels.

Forecast adjusted group net profit after tax for the December half is $46-48 million, on trading profit down 1-2%.

The Warehouse will release its half-year results & full-year guidance on Friday 7 March.

Attribution: Company releases.

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4 Warehouse sales worth $117 million, $90 million for Wiri centre

Published 28 August 2012

The Warehouse Group Ltd said yesterday it expects to realise $117 million from the sale of 4 properties, generating a pretax gain of $62-64 million which would be ploughed back into the business.

Biggest of the group is its 21.7ha North Island distribution centre at Wiri, sold to the Accident Compensation Corp for $90 million and leased back to The Warehouse for 20 years, with rights of renewal. The new lease starts at $6.2 million plus gst/year, which puts the transaction on a 6.9% yield.

The centre distributes general merchandise to 57 stores and also sends consumables & apparel to The Warehouse’s whole network of 89 stores.

The sales of the distribution centre and the stores at Palmerston North & Queenstown are unconditional and a third store, at Snells Beach, is under a conditional contract. All will be leased back to The Warehouse for 10-year terms with rights of renewal.

Colliers International agents Peter Herdson, Charles Cooper & Greg Goldfinch handled the Wiri sale and Colliers also handled the other 2 unconditional sales, both to local investors.

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Attribution: Company & agency releases, story written by Bob Dey for the Bob Dey Property Report.

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Warehouse to sell distribution centre & 3 stores

Published 5 June 2012

The Warehouse Group Ltd hopes to collect a net $100 million from the sale & leaseback of its North Island distribution centre at Wiri and 3 stores.

Group chief executive Mark Powell said on Friday the sales process through Colliers International should be completed during the next 6 months.

"The Warehouse regularly reviews its property holdings to determine whether to own or lease a particular property, and the most recent review has resulted in the marketing of these properties. The sale proceeds will be reinvested in the business, in line with the priorities identified in the company’s strategic plan."

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Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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Warehouse plans $100 million bond issue

Published 9 February 2010

The Warehouse Group Ltd said today it was considering offering up to $100 million of 5-year senior bonds, opening in late March.

 

Chief financial officer Luke Bunt said the company would use the proceeds for general corporate purposes. It’s appointed Craigs Investment Partners Ltd as its advisor.

The company will release more information on the bonds when it announces its interim result on Friday 12 March 2010.

 

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Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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Warehouse Christmas sales flat, Stationery up 3.5%

Published 6 January 2010

The Warehouse Group Ltd said yesterday total sales for The Warehouse for the 9 weeks to 3 January were flat compared with the same period last year. Same-store sales were also flat. Group chief executive Ian Morrice said: “We had anticipated continued steady sales growth over Christmas but this didn’t materialise. We believe our sales are indicative of the broader non-food retail market overall.” Warehouse Stationery sales were up 3.5% for the 9 weeks, same-store 4.7%. Mr Morice said the company expected adjusted group net profit after tax for the first half of the financial year ending 31 January to be similar to last year’s $56.8 million. The Warehouse will announce its half-year results on Friday 12 March.

 

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Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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