15225 replies to this topic

[Lionelza1]

Lol run some numbers... What a noob

[andi222]

Hi Captain,

yes of course, there are so many other things to consider and I basically compared apples with pears.

I found it interesting however how low that value per store is at Steinhoff. Even with liabilities claims etc.

So was just a thought. But looking forward to your more detailed analysis.

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[Captainfrom82]

Yes and it's very high level. Should just be a thought rather then a factual statement.

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Thanks Andi,

 

It is an interesting way to look at things.  I do however think that it may be a skewed way of comparing.

 

Think of it this way.  You and three other friends each buys a car wash business for $400k.  Supposing that each of you bought using a different measure of debt and equity; so you bought the business 90% on debt, Friend A on 60% debt, Friend B on 30% debt and Friend C bought his business entirely by using his savings. 

 

This does not mean that each of you is worth the $400k.  The obvious reason is that those with debt, would have to settle the debt first.  So all things being equal, on the face of it Friend C has the highest worth.  But supposing that Friend C has some other liability that as yet has not been brought onto the book - suppose that he damaged someone's Bentley while it was at the wash, and suppose the damages is $300k.  Then the person with the highest net worth is now actually Friend B.

 

Companies can be compared similarly.  Market capitalisation does not equal to net worth.  To actually get some degree of comparison you would have to factor in the debt on the books, and any off-balance liabilities.

 

I will run some numbers and revert.

 

Regards

Captainfrom82

[andi222]

Yes and it's very high level. Should just be a thought rather then a factual statement.

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[Captainfrom82]

Thought for the day:
If we calculate the value of a store of large retailers it gives you an indication that something with the value of Steinhoff is wrong.

Tesco has 7000 stores with a MC of 25 Billion. Gives you a value of 3.5 Million for a store.

Walmart has 11300 stores with a MC of 300 Billion. Gives you a value of 27 Million per store

Shoprite has 2800 stores with a MC of 4.5 Billion. Gives you a value of 1.6 Million per store.

Now Steinhoff has 12000 stores at a MC of 250 Million. Gives you a value of 21 thousand.

So you can theoretically buy a store for 21 k Euro. Or 320 thousand shares.

Such a joke. Hope everyone has a good Friday.

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Hey Andi,

 

When you say "MC", what are you referring to?  Market Cap??

 

Regards

Captainfrom82

[DayTraderDad]

Thought for the day:
If we calculate the value of a store of large retailers it gives you an indication that something with the value of Steinhoff is wrong.

Tesco has 7000 stores with a MC of 25 Billion. Gives you a value of 3.5 Million for a store.

Walmart has 11300 stores with a MC of 300 Billion. Gives you a value of 27 Million per store

Shoprite has 2800 stores with a MC of 4.5 Billion. Gives you a value of 1.6 Million per store.

Now Steinhoff has 12000 stores at a MC of 250 Million. Gives you a value of 21 thousand.

So you can theoretically buy a store for 21 k Euro. Or 320 thousand shares.

Such a joke. Hope everyone has a good Friday.

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Good post Andi.  So we can be looking for a value of at least 1.6 mil in the future.

[andi222]

Thought for the day:
If we calculate the value of a store of large retailers it gives you an indication that something with the value of Steinhoff is wrong.

Tesco has 7000 stores with a MC of 25 Billion. Gives you a value of 3.5 Million for a store.

Walmart has 11300 stores with a MC of 300 Billion. Gives you a value of 27 Million per store

Shoprite has 2800 stores with a MC of 4.5 Billion. Gives you a value of 1.6 Million per store.

Now Steinhoff has 12000 stores at a MC of 250 Million. Gives you a value of 21 thousand.

So you can theoretically buy a store for 21 k Euro. Or 320 thousand shares.

Such a joke. Hope everyone has a good Friday.

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[DayTraderDad]

Hovering at R1.... Exactly what Polly said market will price it at..... Apart from his big fat zero!

And if snh doesn't sort their stories out... More than likely Mr Market will take it there

 

Yes and Polly the troll also said Delta Fund was going to go up and up look what happened!!!

[Lionelza1]

And before he says it.... I do not hate snh... If I see things turning for the better.... Me and my balls will be back in the game

[Lionelza1]

Hovering at R1.... Exactly what Polly said market will price it at..... Apart from his big fat zero!

And if snh doesn't sort their stories out... More than likely Mr Market will take it there

[DayTraderDad]

Always thought this was the plan... Common agreement, still waiting to hear if they will pay with equity rather than money which allows for value of share to further increase with settlement giving the claimants additional value........

Litigants wont be happy, but they do have a choice, get something or nothing... Not full recompensation...

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Yes I agree still think the money will come from insurance, banks, claims from persons responsible and the most famous Deloitte.

[Investment novice]

Interesting article: https://www.business...ises-their-ire/


"Steinhoff wants to panel-beat them all together into one consolidated action. It launched an application to this effect a week ago. The litigants do not appear to be happy about the plan and regard it as part of Steinhoff’s stalling tactics."

Always thought this was the plan... Common agreement, still waiting to hear if they will pay with equity rather than money which allows for value of share to further increase with settlement giving the claimants additional value........

Litigants wont be happy, but they do have a choice, get something or nothing... Not full recompensation...

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[DayTraderDad]

Interesting article: https://www.business...ises-their-ire/

 

 

"Steinhoff wants to panel-beat them all together into one consolidated action. It launched an application to this effect a week ago. The litigants do not appear to be happy about the plan and regard it as part of Steinhoff’s stalling tactics."

Edited by DayTraderDad, 05 October 2019 - 10:36 AM.

[Chris101]

R 473 000 traded for today in 66 transactions.

 

Stillness before the storm?

haha

[Investment novice]

The conspiracy with mf is old, have a listed entity engaging with mf with a renewed relationship taking over a third of floor space.

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[Captainfrom82]

Discuss in a civil manner and respect the views of others:

 

Best Regards

Captainfrom82

 

===============

 

Source: https://psuvanguard....ndering-scheme/

 

Is Mattress Firm a front for a large-scale money large-scale money laundering scheme?

Mattress Firm stores are everywhere.

 

 

It’s not uncommon to see two or three in the same shopping center, sometimes even across the street from one another. And not just two different mattress stores to promote competition, but the same exact store: Mattress Firm. 

On top of how many Mattress Firm stores there seems to be, there are also all the other brick-and-mortar mattress companies out there, such as Mattress World and BedMart.  

 

 

In fact, there are currently more mattress stores than McDonald’s—or Starbucks—in the United States, most of which are Mattress Firms, according to USA Today. 

 

 

Illustrating this point, 42.6% of Mattress Firm stores are within a one-mile radius of one another, according to Business Insider.

 

 

The average American only buys a new mattress every seven to 10 years. Plus, most millennials are having their mattresses delivered straight to their doors with bed-in-a-box services, according to USA Today. 

So why are there so many Mattress Firms?

 

 

A conspiracy theory recently went viral on Reddit after a user suggested that Mattress Firm was a front for a large scale money laundering scheme. How could a company with such a slow-moving product manage to keep so many stores open, many Reddit users wondered. 

 

 

“Mattress Firm is some sort of giant money laundering scheme,” one user wrote. “I remember seeing four Mattress Firms all on each corner of an intersection once, and there is no way there is such a demand for mattresses.”

“Multiple stores = more places to shuffle money between and more sources for fake money to appear to come from,” another user wrote. 

 

 

Viral YouTube star Shane Dawson also popularized the idea in a video examining various conspiracy theories that racked up nearly 20 million views.

 

But what’s really going on? 

 

 

Shortly after the conspiracy theory went viral, Mattress Firm CEO Steve Stagner announced Mattress Firm would be filing for chapter 11 bankruptcy protection and would be closing nearly 700 stores, especially in areas where it has too many stores “in close proximity to each other,” according to Business Insider.

 

 

The abundance of Mattress Firm stores and rapidly declining sales to the rise of bed-in-a-box companies contributed to the company’s continuing downfall. 

 

 

But the heart of their financial struggles, according to USA Today, lies in the overexpansion of the company, along with the overexpansion of mattress stores in general. 

 

 

Mattress Firm ballooned considerably after the company bought out other mattress companies like Mattress Giant, Sleep Train and Sleepy’s. After the buyouts, Mattress Giant’s and Sleep Trains were simply rebranded as new Mattress Firm stores, hence why two competing mattress stores across the street from one another became the same store. 

Thus the thousands of Mattress Firm stores all within at least a one mile radius of other Mattress Firm stores.

Sounds pretty straightforward—but here’s where things get interesting:

 

 

Steinhoff, the second largest furniture-retailer in the world right after IKEA, and Mattress Firm’s parent company, recently acknowledged in a public filing that the company is being accused of accounting irregularities, including overstating how much money the company made, as well as improperly accounting intercompany loans.

In other words, fraud. 

 

 

The irregularities have been going on for years, but only recently came under public scrutiny in 2017 after Steinhoff CEO Markus Jooste resigned seemingly out of the blue. 

 

 

Steinhoff is located in South Africa, and has been one of the largest companies on the Johannasburg stock exchange since 1996. The revelations of fraud and Jooste’s resignation marked one of the largest collapses in South Africa’s corporate history, according to Household Name, a Business Insider podcast. 

Steinhoff has hired its own auditors to look into the allegations, and investigations and probes from around the world have begun looking into Steinhoff’s financial activities over the years. The full extent of the fraud and tax evasion remains unknown.

 

 

Following these revelations, two top executives and the chairman of Steinhoff resigned, according to Business Insider. 

In what was criticized for being a terrible idea, Steinhoff bought Mattress Firm in 2016 for $2.4 billion, twice what it was really worth. Shortly thereafter, Jooste got into some kind of argument with one of Mattress Firm’s top suppliers, Tempur Sealy, who then went on to sue Mattress Firm for selling mattresses similar to Tempur Sealy’s iconic Tempur-Pedic Mattress. 

 

 

On top of all of that, Mattress Firm filed a lawsuit in October 2017 accusing two of its former real-estate executives, an external broker and a group of developers of signing leases above market rates, and expanding Mattress Firm into expensive areas in an effort to financially enrich themselves at the company’s expense. 

A spokesperson for Mattress Firm described the incident to Business Insider as “nationwide bribery” and a “fraud scheme.” 

 

 

At the moment, there’s no way to know whether or not Mattress Firm was bought by Steinhoff in order to shuffle money for other, more lucrative purposes; but one thing is certain—the Mattress Firm debacle is starting to look less and less like just a conspiracy theory.

 

===================

 

[Captainfrom82]

All i quiet... But snh still working in background.....expect news on conforama store closures and retrenchments... Turnaround at matress firm.... Yada yada yada.... We all hoping for litigation news or strategy.... But think full year 2019 results may be the only good news out in december... Exoect this share to hover aimlessly....or start to pickuo as we get trickling of news from entities...

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Hey IN,

 

You are spot on about lots taking place in the background.  Two factors are now being aggressive addressed: Litigation and debt.

 

For example there have been many discussions regarding the litigation, both vendor and shareholder.

 

Over this week, as part of the ongoing restructuring the name of Pepkor Europe has now played itself out where the Companies House of England has agreed to the name change of Pepco Group Limited.  This is the last steps towards the listing of the company in London.

 

Best Regards

Captainfrom82

[Investment novice]

All i quiet... But snh still working in background.....expect news on conforama store closures and retrenchments... Turnaround at matress firm.... Yada yada yada.... We all hoping for litigation news or strategy.... But think full year 2019 results may be the only good news out in december... Exoect this share to hover aimlessly....or start to pickuo as we get trickling of news from entities...

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[Captainfrom82]

Hi Captain,

 

...

But, to come back to Steinhoff; I have been following the chats regularly and have seen all the contributions and the silly negative responses and do not want to go there safe to say, I believe this Steinhoff ship is being turned around steadily and that, in the end, if you not in this game to make a fast buck on shorting it, you will eventually see success. Also, to manage Steinhoff with its current problems must be a huge and very difficult task and the team is performing well as far as I am concerned and in the end it will not all be lost for PIC as well..PIC must just also hang in there!!

 

Regards

Trader001

. 

 

Hey Trader001,

 

Yeah, we had some pretty robust exchanges here, to the point that some of us now exchange ideas via private messages.  This is a pity because the whole point of having an online chat is to put ideas across no matter how outlandish.  I guess that we are ALL responsible for this one way or another. 

 

Back to Steinhoff, a few questions makes for interesting discussions (this is open to everyone.  DTD, Adi, Bubble, etc have shared their views offline.  We typically estimated revenue and operating profit or EBITDA.  We speculate on the debt, and various other key Steinhoff matters  I will leave it to them to share their views on this platform if they so wish.   I have also discussed with colleagues in the US and Europe who are probably more objective in their thinking). 

 

I am hopeful that we can get back to having open fact based discussions without the insults, aggression false news that was being perpetuated. 

 

 

1. What do you think are the numbers involved in terms of the value remaining in the Group? 

• A few of us across the world have performed a bottom up calculation and we are very close to each other. 
• The ball park appears to be at a worst case €8b  to some people who are extremely optimistic over a longer term horizon and place this valuation around €16b. 
• We then considered the NAV (if any) pror to the off-balance sheet liabilities.

 

2. How do you see the litigation (both vendor as well as shareholder) playing out?

• At what value would you place the litigation and why?
• Will these be settled out of Court or do you think it will go all the way to a legal conclusion?
• Do you have any timelines?
• What will the involvement of the co-respondents (Deloitte, the other lawyers and advisors, etc) in the settlement or penalties? 
• Steinhoff has changed auditors by removing Deloitte.  Is this significant and does it say something about the lawsuit?
• What about the liability insurance?

 

3. What is your view on the debt? 

• Will Steinhoff look to trade their way to reducing debt, or will they sell assets to pair the debt?
• Will shares be issued?
• What is the maximum debt that Steinhoff could expect to sustain after FY21? 
• Will Management take Steinhoff private and delist in order to manage affairs  out of the limelight? (I think this was IN's thoughts).

4. What are your thoughts about Pepkor Europe and Pepkor Holdings (old STAR)?

• Will Steinhoff sell any portion of these holdings (they currently hold 100% of PE and 71% of PH). Why?
• If yes to above, value the business and provide your reasoning
• How will the proceeds be used?

5. Do you have an idea of the value involved in the Automotive unit sale?

 

6. Is Steinhoff going to sell portion of Greenlit?  Provide a valuation.

 

7. Has anything happened (good or bad) over the past 3 months that has changed your view on Steinhoff?  

 

 

Hoping for a nice comprehensive discussion online.

 

Best Regards

CF82

[Trader001]

Hi Trader001,

 

Pepkor Holdings is a real giant with over 5300 stores and almost 50k employees. 

 

To place Tekkie Town into context, TT contributes less than 8% of stores, and around 4% of employees.  I cannot easily find out what TT contributes to both revenue and earnings (Steinhoff seem to be very carefully managing their reporting and analysts presentations in this regard).

 

It would not hurt me in the least if the entire transaction is reversed and Steinhoff/Pepkor gets back its money and TT goes back to the litigating previous owners.  The complication is obviously that there was a cash component also involved in the previous sale to Steinhoff/Pepkor.  That party is never going to agree to have the transaction reversed.

 

Jooste massively overpaid for TT.  I am not sure how BVH would be able to challenge the deal.

 

The real value in Pepkor Holdings is Pep Stores and Ackermans. 

 

Best Regards

Captainfrom82

Hi Captain,

 

Yes, your response is more factual about the matter. Your opening statement and closing statement really sums it up, the latter being.." The real value in Pepkor Holdings is Pep Stores and Ackermans".

I think everyone is feeling the pinch in this difficult economic times yet it was reported that the GDP was actually around 3% in the second quarter 2019 to every one's surprise...well to mine at least. Nevertheless, even in these difficult times, Pep and Ackermans stores just always seems to be busy no matter what time of day..

But, to come back to Steinhoff; I have been following the chats regularly and have seen all the contributions and the silly negative responses and do not want to go there safe to say, I believe this Steinhoff ship is being turned around steadily and that, in the end, if you not in this game to make a fast buck on shorting it, you will eventually see success. Also, to manage Steinhoff with its current problems must be a huge and very difficult task and the team is performing well as far as I am concerned and in the end it will not all be lost for PIC as well..PIC must just also hang in there!!

 

Regards

Trader001

.