Retail

UK landlords’ lifeboat has a Debenhams-shaped leak

11 September 2018

As British retailers flounder, the groups that rent them floor space have been pointing to continuing robust demand for prime locations. Debenhams’ potential restructuring not only threatens a key source of rental income. It also undermines landlords’ main counterargument.

Jack Ma’s exit plan just raises more questions

10 September 2018

Alibaba says CEO Daniel Zhang will succeed the $420 bln group's co-founder as chairman in 2019. Planning ahead is laudable, but the sketchy blueprint, after a baffling interview, leaves worries over the top job and Ma's influence unanswered. It's one step forward, two steps back.

Jack Ma’s next moves will instruct China tech

8 September 2018

The charismatic co-founder of Alibaba says he plans to retire. It’s a sign of the $420 bln company’s maturity that others are ready to step up, unlike at rivals like scandal-hit JD. But he will still wield huge influence. Investors will want clarity on who really holds the reins.

Amazon’s next challenge: $1 trillion of revenue

4 September 2018

The U.S. retailer’s 13-digit market capitalization puts it in a club whose only other member is iPhone maker Apple. But market values have limited real-world meaning. Achieving sales of the same magnitude – twice top dog Walmart’s – would be more crunchy. It could happen.

Nike puts politically divisive spring in its step

4 September 2018

The U.S. brand is putting Colin Kaepernick, the first NFL player to kneel for the national anthem, in its revived “Just Do It” ads. Airlines, sports stores and pizza chains have wrestled with partisan issues. In the commoditized sneaker trade, it’s a risk worth taking.

Alibaba channels old-school conglomerates

23 August 2018

Quarterly sales at the Chinese e-commerce firm soared 61 pct to $12 bln, but earnings were flat compared to a year ago. That's due to investments in cloud computing, supermarkets, video streaming and other bets. Alibaba's unwieldy mix of businesses may merit a valuation discount.

Russia will keep on mixing toys and politics

21 August 2018

Strong first-half sales at children’s store Detsky Mir will help Sistema, which needs to sell its stake after a costly $1.5 billion settlement with Rosneft. A less politically risky owner might help the rapidly growing toy group’s low valuation. Yet that’s in no way guaranteed.

Hong Kong death offers humbling reminder to CEOs

21 August 2018

Shares of snack store operator CEC doubled following news that its founder had unexpectedly died. Research suggests such investor reactions are common, albeit usually less dramatic. Boards and bosses often contribute less value than they otherwise might think.

Mulberry hits every luxury branch on the way down

20 August 2018

Almost three-quarter of the bagmaker’s sales are in the tough UK market. That, and a costly push into Asia amid the threat of a China-U.S. trade war, explains why Mulberry’s shares are down 60 pct this year. A fresh hit from House of Fraser’s demise is par for the course.

Review: Philip Green’s road to boom and bust

17 August 2018

The British retail tycoon thrived in an era of rampant consumerism, leveraged buyouts and tax avoidance. “Damaged Goods” reveals how this propelled him to the highest echelons of British society. His subsequent downfall is a cautionary tale for today’s troubled retailers.

Walmart sharpens as Amazon efficiency edge dulls

16 August 2018

The $270 bln retailer increased quarterly sales 4 pct. That pales next to its Seattle rival’s latest 39 pct rise. But Walmart’s workers are as productive as ever while Amazon is employing many more, and getting less in return, as it expands stores, warehouses and distribution.

Airbnb’s China business could learn from Uber

16 August 2018

The flat-sharing giant faces stiff competition and regulatory risk in the People’s Republic, but that doesn’t mean it should cut and run like Uber did. Partnering with a domestic incumbent could help both sides cash in on China’s travel boom.

Amazon Pentagon ties may receive greater scrutiny

14 August 2018

Donald Trump is no fan of Jeff Bezos. But the U.S government could become an even bigger Amazon client as the Department of Defense seeks pitches for a $10 bln cloud deal. The juggernaut’s slick Pentagon networking could give rivals like Oracle some curious optics to exploit.

China Literature splurges on confusing plot twist

14 August 2018

Shares in the $7 bln online publisher sank on lacklustre earnings and a big cash and stock acquisition. Diversifying to buy a video producer one third its size is bad enough. That Tencent, which already owns a movie-studio, is on both sides of the deal makes it more muddled.

Collapsing deals point to tired M&A bull market

9 August 2018

Tribune and Rite Aid terminated plans to sell themselves after shareholders and regulators objected. Perceived double-dealing also played a role. But crummy transactions falling apart is to be expected from a late-stage of a merger cycle that has run its course.

Easing could re-inflate China’s housing bubble

9 August 2018

Beijing wants more active fiscal policy to buttress growth. A crackdown on shadow banking, plus mortgage curbs, have bit into frothy real estate. Unfortunately new money tends to pour into property. Recent rules might slow speculation, but a price rise looks hard to avoid.

Casino shares go wrong way in risky debt punt

8 August 2018

The grocer’s shares fell 9 pct after an analyst flagged its related party deals. A sinking price may force its indebted parent to pledge stock to repay bonds, which could end up on the market. Investors have more to worry about than a grim outlook for French supermarkets.

Stake sales could ease CK Hutchison’s debt drag

3 August 2018

The ports-to-telecom conglomerate reported strong first-half results. But recent large acquisitions have left new Chairman Victor Li facing a mounting debt pile. Selling part of its Watsons health and beauty chain or Husky Energy would ease the burden without yielding control.

China’s prickly new watchdog can hit at home too

2 August 2018

Fresh from its role in torpedoing Qualcomm’s $44 bln NXP bid, Beijing’s all-in-one consumer regulator is now investigating the newly-listed Pinduoduo over fake goods, sending the stock down 10 pct. China has built a powerful champion: investors are right to be afraid.

Prada’s hottest trend is investor FOMO

1 August 2018

The Italian label grew first-half sales 9 percent thanks to spruced-up handbags. Operating margins are almost two-thirds below their peak, but a full turnaround is priced in. Fear of missing out on the next Gucci-style makeover makes shareholders reluctant to wait for results.