Not good news from the sales front in luxury goods with shares in online luxury goods seller Cettire closing down more than 21% after the company slipped out a weak half year report.
As well as the weak half year report, millions of shares were released from escrow which weighed on the share price.
That saw more than 7 million shares traded, around seven times normal daily turnover in recent weeks.
While Cettire, which sells brands such as Saint Laurent, Balenciaga and Burberry, revealed half year sales nearly tripled to $154 million, it reported a statutory loss of $8.3 million for the half, down on the prior half’s profit of $2.3 million.
The company warned last month that today would also be the day that 62 million of its shares would be released from escrow from its IPO in 2020, indicating that the drop in share price is part of a significant sell-off.
Cettire said sales in January grew 242% compared to last year but in all the volume, investors ignored that upbeat bit of news.
CEO Dean Mintz told shareholders the focus of the business would continue to be on revenue growth.
“Our growth trajectory has continued into H2 FY22, where we have experienced a further acceleration in our growth rate in January,” he said.
“Given the global growth opportunity available to Cettire, we will be running the business to maximise revenues by further investing in brand and customer acquisition, to drive long-term shareholder value.”
That sounded like margins would be sacrificed to build sales which investors will only tolerate for while the growth is clearly evident.
The shares ended at $2.38, down 21.2%. They had been as low as $2.35.
…………
Poker machine giant Aristocrat Leisure’s ambitions to expand deeper into online gambling via the takeover of UK based software outfit Playtech have failed after a group of shareholders in the target company refused to get interested in the $A4 billion offer.
Aristocrat needed 75% of Playtech’s shareholders to support the (2.1 billion pounds) deal, but just under 55% voted in its favour at a shareholder meeting overnight Wednesday, meaning the deal was lost.
London-listed Playtech – which makes software for online casinos – had recommended its shareholders back the takeover but some of its investors has objected to Aristocrat’s offer and had been seeking alternatives, all of which failed.
Aristocrat released an ASX statement late on Wednesday anticipating that the vote would be unsuccessful, and blaming the outcome on Playtech investors who only bought shares after the takeover was announced in October last year.
“In particular, the emergence of a certain group of shareholders who built a blocking stake while refusing to engage with either ourselves or Playtech materially impacted the prospects for the success of our offer,” Aristocrat CEO Trevor Croker said in the late Wednesday statement.
Aristocrat shares dipped 0.4% to $41.09 in reaction to the lost vote.
A short three paragraph statement on Thursday noted the lost vote but made no further comments about what Aristocrat might now do.
Analysts point out that Aristocrat now has a lot of cash for either a new deal (and the targets seem to be limited) or for some capital management for shareholders.
