Thank you all for your e-mails, harrowing as they are, asking me to comment on the collapse of the Woolworths Group plc and, in particular, the confusion surrounding the Net Assets Value (NAV) per share reported in the September 2008 Interim Accounts.
On the 16th September 2008 the results of our Poll indicated an expectation that the Woolworth’s Group Net Asset Value per share would be 21p or over. When the Interim Results were announced the following day I calculated that Woolworths group Net Asset per share had fallen to 16.12p.
The Interim results, released on the 17th September 2008, were the first since Stephen Johnson took over as group Chief Executive Officer (CEO) on the 1st September 2008. Most of the fall I attributed to Woolworth's historically strong second half (which included the crucial Christmas period) however, with Woolworths Group Net Asset Value at 4th August 2007 reported 18.36p per share, interim to interim, Net Asset Value had deteriorated 14%.
Writing on the 11th August 2008 it seemed to me that Woolworths Net Asset Value had been largely overlooked by the financial press. By the time the Interim Results were announced on the September 17th 2008 the gap between the reported Net Asset Value and the share price widened to 11p per share.
Backed by substantial Assets and profitable businesses Bertram Books and 2 Entertain, which alone was believed to be worth as much as £200 million, investors naturally expected, at the very least, that the Company could have been rationalized in the interest of all stake holders. After all, Stephen Johnson the new CEO at the group was a reconstruction specialist so why instead did Stephen Johnson put the retail arm into administration just 3 months after his appointment?
To be continued.............
On the 16th September 2008 the results of our Poll indicated an expectation that the Woolworth’s Group Net Asset Value per share would be 21p or over. When the Interim Results were announced the following day I calculated that Woolworths group Net Asset per share had fallen to 16.12p.
The Interim results, released on the 17th September 2008, were the first since Stephen Johnson took over as group Chief Executive Officer (CEO) on the 1st September 2008. Most of the fall I attributed to Woolworth's historically strong second half (which included the crucial Christmas period) however, with Woolworths Group Net Asset Value at 4th August 2007 reported 18.36p per share, interim to interim, Net Asset Value had deteriorated 14%.
Writing on the 11th August 2008 it seemed to me that Woolworths Net Asset Value had been largely overlooked by the financial press. By the time the Interim Results were announced on the September 17th 2008 the gap between the reported Net Asset Value and the share price widened to 11p per share.
Backed by substantial Assets and profitable businesses Bertram Books and 2 Entertain, which alone was believed to be worth as much as £200 million, investors naturally expected, at the very least, that the Company could have been rationalized in the interest of all stake holders. After all, Stephen Johnson the new CEO at the group was a reconstruction specialist so why instead did Stephen Johnson put the retail arm into administration just 3 months after his appointment?
To be continued.............
Please feel free to comment.
6 comments:
I believe if Steve hadn't put woolworths into administration he would be working outside the trading laws, from the articles i read it was the loss of insurance cover that created this problem Steve had to transfer from buying stock on credit to paying up front, having over 800 stores to stock for the christmas period imo was enough to collapse woolies, but why didn't the G man step in and guarantee woolies insurance which imo would have stopped the christmas price war on the high street started by Delloittes the sdminsitrators of woolies.
IMHO the knock on effect of Gordon not stepping in has caused other retailer disscounting like woolies hence the high street collapse.
To summerise:-
The high steet shops rely heavily on christmas trading for survival and cant with stand administrators disscounts, the dominos topple.
believe if Steve hadn't put woolworths into administration he would be working outside the trading laws, from the articles i read it was the loss of insurance cover that created this problem Steve had to transfer from buying stock on credit to paying up front, having over 800 stores to stock for the christmas period imo was enough to collapse woolies, but why didn't the G man step in and guarantee woolies insurance which imo would have stopped the christmas price war on the high street started by Delloittes the sdminsitrators of woolies.
IMHO the knock on effect of Gordon not stepping in has caused other retailer disscounting like woolies hence the high street collapse.
To summerise:-
The high steet shops rely heavily on christmas trading for survival and cant with stand administrators disscounts, the dominos topple.
Anthony any thoughts on todays events Barclay Bros buy woolworth.co.uk name along with Ladybird.
SUNNY SIDE UP !
http://www.thesun.co.uk/sol/homepage/news/money/article2202810.ece
When can we expect Part 2
Cant blame Stephen Johnson for putting woolies into admin his hands were tied.
I blame the government all they needed to do was guarantee woolies
credit insurance.
END OF !
f6
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