Ann: Trading Update for the 26 weeks to 1 January 2023, page-11

Old stock moved on now?
Loan availability increased, but I think this notice indicates $12.9m of debt will be reduced to just $2.9m on July 1?

“..The facility limit will be reduced by a further $10m at the start of FY24 in line with the Group’s expectations of being in a positive net cash position by the end of the FY23. ​

Net debt as at the end of 1HFY23 is expected to be $12.9m.”​

And 66c perhaps continues as a TA definitive  ‘crunchline’ [see @Saragian chart 29/11/22] after that ever so convenient dip into which Brett was able to secure his 7.3% of the company?

…and during which ‘down time’ Australian Super was being counter-cylic as well!​

​

But what next?

I sold half my shares here yesterday as they had become a bit too plus-sized, but I get the feeling that now Brett’s declared his hand - for some reason right before the unappetising trading update - that maybe the big guys don’t want the price to lapse long term into the sub 60s underworld.
- So perhaps today is a buying opportunity ??
….  But what could kick the price along in this rather bleak recessive cycle with no updates due other than rather flat, already anticipated ones?


cheers

https://www.afr. com/companies/retail/city-chic-mess-deepens-eyes-h1-loss-20230120-p5ce7z

City Chic mess deepens, eyes first-half loss
Carrie LaFrenzSenior reporter
Jan 20, 2023 – 12.46pm

Sales at women’s specialty fashion retailer City Chic Collective slumped in the December half, leaving it with excess stock that had to be discounted in a competitive market and pushing the retailer into an expected first-half loss.

The group operates many brands, including City Chic, Avenue, Evans, CCX, Hips & Curves, Fox & Royal and Navabi, catering to the plus-size women’s apparel and footwear market.


City Chic shares have tumbled nearly 90 per cent in the year to date.

As The Australian Financial Review flagged in December, the mess at the company has deepened after a series of downgrades.
It said on Friday it expected to post a loss of between $2.5 million and $4 million in the 26 weeks to January 1.

Sales for the first half are expected to be down 8 per cent from a year earlier to $168.6 million, with volatile trade through key events Black Friday/Cyber Monday, Christmas and Boxing Day sales, which led to steep discounting and promotions to move aged stock that crunched its gross margins.

The stock is down about 86 per cent to 70¢ over the past year – but made a significant jump earlier this week after news that AFR Rich Lister Brett Blundy became a new substantial shareholder.



Mr Blundy is one of the biggest names in Australia’s retail sector, backing the likes of Bras N Things, Lovisa and Honey Burdette, to help build a multibillion-dollar fortune.
City Chic said on Friday inventory was expected to be between $163 million and $164 million at the end of the half – below the range it guided at its annual meeting. But it confirmed that it remained on track to trim the inventory balance to $125 million to $135 million at the end of the financial year.
Chief executive Phil Ryan said the company was on track to deliver its strategic logistics initiatives, and continue to focus on cost management.
“With the support of our lender, we have amended our debt facility in line with our changing business needs. We remain extremely confident in executing on our strategies and returning to profitable growth as these cyclical headwinds unwind,” he said.
Citi analyst Sam Teeger said in a note earlier this week the arrival of Mr Blundy on City Chic’s register is positive.
“While City Chic’s interim result next month is unlikely to be good, in our view, Mr Blundy’s new shareholding in City Chic suggests there may be upside to business performance over the medium to longer term,” he said.
He said since City Chic does not have bricks-and-mortar stores in the US, it could be at a competitive disadvantage compared to US and UK competitors who have a physical store presence. This would also decrease City Chic’s addressable market in the US from $US49 billion to $US38 billion, he added.
City Chic is a global online and bricks-and-mortar retailer with a network of 90 stores across Australia and New Zealand and websites operating in ANZ, the US, the UK and Europe. The retailer will announce its audited financial results on February 27.