thanks for the analysis. hope they can get listed as per plans (in 2012)

thanks @the deal

Revenues for the 1H 2011 were up 38%, despite the surge in revenues operating margins were stagnant at 4.3% which is quiet low compared to Mr Price South Africa whose operating Margins come in around 12%, management says business was slow in the 1H of 2011 due to the seasonality nature of the business and they expect sales to pick up in the 2H due to factors such as festive season shopping


Read more here http://www.contrarianinv...ansion-our-analysis.html

Mzee @deal how were you able to calculate operating margin from the results as provided? Could you be referring to net profit margin?

I also didn't pick where management said 'business was slow in 1H' as you claim. Are we reading the same commentary?


Otherwise the sales per square foot shows good insight on your part. Ditto the comparison to Mr Price SA; which seems like a much better run business.

Note though Mr Price SA is one brand, but Deacons makes most from Woolworths/Truworths closely followed by Mr Price and then includes a litter of other brands e.g. Adiddas, Identity, Life Fitness

http://deacons.co.ke/site/images/interimaccounts.pdf

Operating Margins is NOT the same as Net Profit Margins. Since you are a 'young' analyst, I shall not blast you but refer you to a few Finance Textbooks.

2 firms with the same sales, margins, etc but different Capital Structures will have different NPM even if the OM is the same.