Reitmans Ord Shs V.RET

Q1 results

[tomperns]

They missed my personal expectations of a $5M bottom line, but they did generate $18M of operating cash flow. I still think a $50M market cap is ridiculous for a company with a book value of $200M and working capital of $100M that has now generated positive cash flow for 4 consecutive quarters.

[NicolasR]

They actually way surpassed mine... and theirs. For me, the most important line of this press release, by far, is the following: "Results from operating activities for the first quarter of fiscal 2023 are the strongest in the last nine comparative quarters other than the comparative quarter of fiscal 2022, which included Federal subsidies of $10.3 million ". Q1 has always shown

[Mephistopheles3]

I saw that as well.  This was the best Q1 in 9 years and didn't quite blow away my expectations - but it did surpass them. We are looking at a pretty strong Q2-Q3 if trend continues.  It really looks like they closed down the loser stores in the pandemic - it was good to see 0 stores being shut in Q1. Other interesting thing that's new this quarter is the presentation of "

[savyinvestor333]

Looks like they actually opened 2 stores this quarter

[TheCount11]

Congrats to Reitmans management on a great quarter! Q1 gross profit increased $24.1 million to $84.0 million while gross margins were 54.6% from 49.4% for the first quarter of 2022.  Its nice to see Q1 GM back in the 55% range. Cash from operations  $18M Lease payment of lease $7.4M Operating Cashflow $10.4M Cap Ex $2.5M Inventory increased by $18.5M assuming it is high

[Mephistopheles3]

One thing I've normalized for in the cash flow is that included in your $18 million figure is $2.7 million for the collection of the government receivables & $5.9 million of prepaids which is included in that amount.  The decrease in prepaids is the result of RET not having to keep large deposits with their suppliers as they're now of bankruptcy.  So both for me are one-time

[TheCount11]

If the BMO agreement prevents them from doing buybacks that would be a TERRIBLE agreement.  Yeah TERRIBLE.  Why? Reitmans has land and buildings that are worth multiples of that as well inventory and restricted cash.  I don't think senoir management is inept. The annual meeting is coming up and I want to hear about capital allocation mainly buybacks.  Putting an NCIB in

[tomperns]

Count, I feel the exact same way and I own over 100,000 shares that I also bought with my hard earned money. I'm pretty disgusted that I haven't seen 1 insider buy any shares at this ridiculous market cap. I do however five them props for saving this ship. But now that the ship is back in order, it's time for them to adress shareholder value!

[TheCount11]

Exactly!  Book value is roughly $5 per share.  It doesn't take a rocket scientist to figure out that companies that issue options to management NEED to buyback stock in order not to dilute shareholders otherwise its just a transfer of wealth from owners to management if options are issued for less than $5.

[tomperns]

Go see trade history on the voting shares. We have one jackass (scotia) that was hellbent to sell his 18,200 shares and then we have anonymous playing games and voila! What should have been a 50 percent pop today was squashed just like that

[Gann999]

It happens tomorrow is another day

[savyinvestor333]

416,000 shares traded so far today RET.A - V  ATS 0.6 0.87 · 0.91 0.2 0.91 -0.15 -14.2 416.0 356 141 1.01  1.10  0.85 2.38  0.335 14:11:47 Jun 21 15 min RT 2¢ TSX-V - V

[Mephistopheles3]

All banking agreements have restrictions on buybacks / dividends.  I actually have a large corporate agreement with the BMO group in Montreal, so I know the bankers who are dealing with RET.  Distributions are typically defined as both dividends & share buybacks and you are always restricted in making distributions if they result in a breach of covenants.  Normally covenants

[tomperns]

You are most likely correct that they can't do buy-backs but if they personally bought a combined 100k shares at market (with this anemic volume), market cap would double. Gutless and apathetic comes to mind.

[Mephistopheles3]

I'm kind of surprised shares didn't pop a bit more - I'm responsible for like 50% of the volume today as I'm still picking up in the $1.03-1.04 range (the non-voting share). If I was an insider, I think I would be quite happy to pick up at this price.   I'm hitting my max risk tolerance for today though - so I'll keep an eye on the price and pick up if it ever

[Northforce13]

"I'm kind of surprised shares didn't pop a bit more - I'm responsible for like 50% of the volume today as I'm still picking up in the $1.03-1.04 range" From what I can see the highest number of shares purchased today by one single broker (National Bank) at 1.03 and 1.04 was... 600 shares? 

[Mephistopheles3]

Most volume on RET happens off exchange on alternative trading platforms, so you won't see the volumes all reported on the TSX itself.  There's some market makers monkeying around in there.  

[TheCount11]

I own over 227K shares. I owned a chunk was before company went bankrupt.    Annual Meeting was today at 11:00 a.m. in Montreal unfortunately was not able to attend in person and could not find a number to call into meeting... 

[TheCount11]

Company has $40M in cash vs LOC of $34M.   Total Current Assets are $219M. Total Current Liabilities are $123M. If the company can't buyback stock after pleding land, buildings, inventory holding restricted cash and has more cash then credit used their credit agreement is TERRIBLE.  Pay it off and get a new one.  Banks issue covenant light LOCs against hard assets