Ann: ADH 1H FY2021 Results Announcement, page-42

@daicosisgod
I think the discussion on the call was very good overall- liked how everyone acknowledged that no one actually knows what is going to happen.
A few things I took note of:
- Marks estimate that long term EBIT margins in the 20-22% could be achieved.
- I think the upsizing strategy, although only partially alluded to has a long way to run. VCXs report noted that specialty retailers doing well were signing new leases and the leasing spreads are still very favourable - I think we have 2-3yrs of favourable tailwinds on that front to come.
- I hadn’t appreciated that linen lovers was impacted negatively during Covid due to store closures. It makes the take up even more impressive.
- the 25% growth in H2 to date is despite suboptimal inventory- which substantially derisks this half. Given that H1 was negatively impacted by the store closures in Melbourne, it’s going to be a full year before difficult to cycle comps occur. Moreover, the DC should be operational by then and hopefully there will be a nascent plan for international expansion.

Overall I think the combination of loyalty + omni + favourable tailwinds in terms of FX and leasing spreads is a very good environment for profitability for a few years yet.

Taking a step back, just love Marks approach to the business in general. Really focusing on the customer, improving every facet of delivery for the customers is ultimately the DNA that will drive returns. I think the financials follow on from that.