The Investment Column: A bargain in Storehouse
Friday 22 May 1998
Total sales rose by nearly 7 per cent but like-for-like growth was just 2.2 per cent at Bhs and 1.8 per cent at Mothercare. Margins improved at Bhs but Mothercare improvement in the second half did not offset the first- half decline caused by mark-downs.
Storehouse has been concentrating for a long time now on stabilising its margins and making sure it gets its prices right first time and is not forced into heavy price cutting in the sales. Management has done well on this issue but with significant investments being made in areas like systems, the City feels Storehouse will have to grow both sales and margins if it is not to suffer a setback.
The worry is that Storehouse has had a short-term boost from the closure of 19 Littlewoods stores as new owner Marks & Spencer undertakes refurbishment work. When those stores re-open under the Marks name, Storehouse may come under further pressure. Storehouse chief executive Keith Edelman says Littlewoods' decision to pull out of childrenswear and home products may counter that move, but the City is not convinced
Moving into sportswear, with some exclusive ranges by Pony and others, will help provide exposure to the branded sports boom but the decision may have come a bit late, with that market now seemingly coming off the boil. Perhaps Bhs will hit the jackpot instead with its lightweight combat gear popularised by the girl band All Saints, but that could turn out to be more of a passing fad than a trend.
After a grim year last year, Storehouse has enjoyed a mini-revival in share price terms and they improved another 12.5p to 256p yesterday. On full-year forecasts of pounds 132m, the shares trade on a forward rating of 12. This is cheap but though there may be room for a small further rise, the shares are not worth chasing much further.
- 1 'Women should not laugh in public,' says Turkey's Deputy Prime Minister in morality speech
- 2 The secret report that helps Israel hide facts
- 3 Is Ebola coming to Britain? UK health officials issue warning to doctors as outbreak fears grow
- 4 Richard Dawkins says 'date rape is bad, stranger rape is worse' on Twitter
- 5 Danish TV reporter is all business up top, all party down below
The secret report that helps Israel hide facts
A day in the life of Vladimir Putin: The dictator in his labyrinth
Woman and two children killed by mob in riots over 'blasphemous' Facebook post in Pakistan
Putin is 'thuggish, dishonest and reckless', says British ambassador to US
Boozy, ignorant, intolerant, but very polite – Britain as others see us
A new Russian revolution: The cracks are starting to appear in Putin’s Kremlin power bloc
- < Previous
- Next >
iJobs Money & Business
£350 - £400 per annum + competitive: Orgtel: Project Manager (specializing in ...
£25000 per annum + OTE £40,000: SThree: Orgtel are seeking Graduate Trainee Re...
£45000 per annum + Benefits: Ashdown Group: ** HR Business Partner - Senior H...
£28000 - £32000 per annum + Benefits: Ashdown Group: PA / Team Secretary - Mat...