CHRIS BURRELL ’ S BLOG
In terms of PM Capital , there are two ways to invest in the Global Opportunities Fund . PGF is a listed investment company on the ASX . It has recovered towards net assets . The board recently announced a 4 cent semi-annual dividend being a net yield of 5.2 % and a gross yield of 7.3 %. Retained earnings will support 6.75 years of dividend . The other channel to invest is into the managed fund , but it does not have the accumulated franking credits as income is being distributed through the trust structure as earned .
The second paper was presented by the Jarden retail analyst , Ben Gilbert , at the Stockbrokers and Financial Advisers ( SAAFA ) conference in Sydney on the 20 th and 21 st of May . Six senior Burrell Directors and Associates attended in person and all other Advisors were registered virtually . Jarden are a New Zealand institutional broker who have established in Australia . They were formally a correspondent for Credit Suisse . Some of the points made by Ben Gilbert in the presentation were :
‐ Pandemic drove unprecedented spending . ‐ Over $ 180B of stimulus for the Australian consumer , driving a material pickup in retail spending . This was driven by a material lift in online , peaking at 20 % of retail sales excluding food in 2020 . ‐ Mobility data being driving and walking fell to 40 % of January 2020 levels and eating out at restaurants to ~ o . ‐ Growth in retail sales i . e . goods came at the expense of consumption services . ‐ The increased savings during COVID in Australia and New Zealand means that there is pent up retail demand . ‐ The early beneficiaries of COVID retail spending included supermarkets and hardware such as Bunnings . It is expected that when vaccinations and a return to more normal movement occurs prior to the end of calendar 2021 , that spending on the early beneficiaries will return to more normal levels . Online engagement is falling . Grocery is expected to be in decline for 2021 .
‐ Online searches show that consumers have significant pent up demand for travel and is likely that this sector will be a beneficiary , particularly domestically . Restaurants and dining out are also returning to more normal levels in states other than where lockdowns remain enforced .
‐ With respect to shopping centres , other than the CBDs in Sydney and Melbourne , there has been a return to pre-COVID levels , in some cases above 90 %. ‐ Winning in a post COVID world ‐ COVID has accelerated rate of structural change o Online Penetration o Availability of data o Supply chain investment
‐ Retailers that will out-perform medium term will 1 . Invest in data & understanding customer 2 . Expand categories into ‘ right to play ’ 3 . Invest in supply chain
Chris Burrell Managing Director
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