Ann: Chairman's and MD Address and trading update to Shareholders, page-7

Hi @neoteric,

Your comment prompted me to have a bit closer look at NCK margins.

The Plush Sofa acquisition is a good example of how they do it:

When NCK bought Plush, the gross margin was 52.4%, they have lifted that somewhat this year, but I note the target is to lift it to 59% by the end of the this financial year.

The turnover of Plush in FY 2021 was $160 mill so if I ignore any expansion in the branch network that NCK may have done since then and just look at the increase in margin in the purchased revenue ( likely to be at least that this year you would think) then that increase in margin of 6.6% would represent a lift in profit ( no more overheads required so all straight to the bottom line) of $10.5 mill in FY 2024.

So, on a $103 mill acquisition they will have added an extra 10% ROI within a couple of full trading years just in margin expansion, PLUS synergies in logistics, head office, etc etc PLUS any expansion of the store network over that period.

I think this is a great example of how NCK continues to produce such great results.

I have been a very satisfied shareholder for a number of years and think I will continue to be.

DYOR