The result was as good as could have been hoped given the earlier guidance. As for the FY forecast, its broadly in line with their earlier statements and last year, and I'm sure the new CEO who officially moves into his CEO role next month will have wanted a guidance target that he can readily meet or even exceed. That said, there has obviously been a lot of discounting at Review and Black Pepper to get to these results. It was also disappointing to see JET's growth has been slower than expected, however Designworks appears to be executing well and should continue to grow significantly in the next 6-12 months. As for cashflows, its looks like the company's small net debt position turned to a net cash position of ~$4m within a couple of days of balance date, so they still appear to be managing cash and inventory levels well. Importantly, they remain financially healthy despite the weaker earnings results, and continue to highlight their available debt facilities so could still be a buyer in any M&A. (and they continue to spruke Houlihan Lokey as a source of potential strategic opportunities). Other comments re online and loyalty are generally positive. Although no dividend is disappointing, they might just be pushing this back to the FY given it will only likely be small for the FY.
PGR Price at posting:
18.5¢ Sentiment: Hold Disclosure: Held
