Ann: COMPANY ANNOUNCEMENT - HALF YEAR RESULTS 31 DEC 2020, page-5

USA should benefit from the Biden stimulus in the second half.

This (and last) financial year is a bit weird, but historically North American sales have a 43-44% skew to the first half. Assuming current sales momentum continue unhindered, and add some stimulus to the mix, it's not unreasonable to expect an additional ~$9-10m EBIT from North America (albeit with some FX headwinds potentially).

Australian sales also have a fairly even skew between the halves (between 49% to 53% over the last 3 years).

From GLB's outlook commentary, I really like that they are investing in working capital and other efforts to really drive growth. There's still a lot of pent-up demand from my own channel checks online, with many SKUs are still running low (or sold out).

I know how much the Hill brothers love their dividends, so if they are showing restraints in the dividend payout ratios, that means there's got to be lots of juicy growth left. I won't be fooled into thinking there's not much growth left when they are still using the words "robust" and "strong". When they said "very strong" it meant like 400% EBIT growth. When they say "modest", it's usually like 30-40% growth or something.

It is also pleasing to see that they are investing heavily in social media and new product development including an Impala mask, flower power in-lines, pink tartan quads (all look pretty good).

The other channel check I do is from regularly visiting my local City Beach. Impala and Stussy (which is distributed by GLB in Australia) are currently the very first products you see entering the store (big showcase).

The dark horse in all of this is the push by FXD into USA and Europe. My understanding is that GLB is looking to replicate the success of FXD in Australia into those markets. With home building and renovations in USA becoming extremely popular, driven by record low interest rates and people working from home, I can see FXD working really well on those cashed-up tradies! Hopefully management continues to execute.