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Reitmans Ord Shs V.RET

Alternate Symbol(s):  RTMNF | RTMAF | V.RET.A

Reitmans (Canada) Limited is a Canada-based specialty apparel retailer for women and men, with retail outlets throughout the country. The principal business activity of the Company is the sale of women’s wear. The Company operates three different brands: Reitmans, Penningtons and RW&CO. The Reitmans banner is a specialty fashion destination. The Reitmans has an online presence and store locations across the country. Penningtons is a destination for plus-size fashion, ranging from sizes 14 to 32. Penningtons operates stores across Canada, as well as an ecommerce site at penningtons.com. RW&CO. operates stores averaging 4,500 square feet in premium locations in shopping malls, as well as on their e-commerce site. Specializing in menswear and womenswear, the brand delivers versatile, well-crafted collections and brand experiences. It operates approximately 391 stores under three distinct banners consisting of 226 Reitmans, 85 Pennington, and 80 RW&CO.


TSXV:RET - Post by User

Comment by Torontojayon Feb 15, 2023 3:30pm
109 Views
Post# 35288253

RE:RE:RE:RE:My two cents

RE:RE:RE:RE:My two cents

I've looked at the cash flow per store for all of the fiscal years 2009-2020. The median was the 2018 fiscal year cash per "average store" of $83.9k and 2013 fiscal year $87.38k

Add them up and divide by 2 gives me an average of $85.64k. We know the cost of living has increased and todays cash flow per store should be higher than the past. My calculation does not take into account maintenance capex but it does remove lease liabilities from my fiscal 2020 computation. For average store, I took the mean of the current and prior fiscal years store count.


A few things to keep in mind. The company has removed the less profitable companies with the restructuring and this gives me confidence the current cash flow per store will be higher than the median. Nonetheless, I Like to keep it simple.

If we use a conservative number such as $85.64k cash per store multiplied by 410 stores (estimated fiscal 2024) then I get a cash flow of $35,112.4K. If we estimate $10-12k for maintenance capex, then a normalized free cash flow should be at least $23-25m.

A 15-20 times multiple on that number and we get a reasonable, albeit conservative, value of anywhere between $7 and $10. 

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