"The Board of Endeavour Group (ASX:EDV) has today announced Jayne Hrdlicka as the Managing Director and Chief Executive Officer to deliver the company’s next phase of growth."
Yesterday, they announce that they will close Oakridge (Yarra Valley) winery restaurant. Before that, they shut down Shingleback Cellar Door operations. ... This does not look like the next phase of growth.
And that is the real problem with EDV management: What are they really saying, and then doing, or not saying and then doing. Eg "after extensive global search" (sic), they find Jane Hrdlicka, right here in Australia (right under their nose - so to speak). Apparently,the globe must have very few capable CEOs. I am sure that regulatory approval will come.
And here is my speculation:
What am I saying: EDV is not on a path of growth. It is on a path of shrinking itself to an improved profitability; ie. shed the business units that are below a set threshold of profit contribution (and there are other Cellar Door restaurants in the portfolio).
When JH was at A2M, she initiated the installation of an 'Enterprise Information System' (not cheap I might add); these things are used to improve the running, optimising, and controlling all business aspects. And once it is all done, EDV is up for sale (to private equity) or split up into parts (say separation from ALH). ... and we all know that the sum of the parts is more than the current conglomerate. One should watch out for option right issues to management.
On the basis of this: share price weakness is an entry opportunity.
EDV Price at posting:
$4.05 Sentiment: Hold Disclosure: Held
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