Shane Solly: Harbour Asset Management expert on the Warehouse reporting a downturn

The Warehouse is being his hard by the tough economic conditions.

New reports show profits are down and the retail giant is looking to slash jobs.

Harbour Asset Management's Shane Solly explained further.

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Episode Transcript

Speaker 1 (00:00):
Shane Solly, Harbor Asset Management, Shane good evening. Yeay, right,
another mixed update from the warehouse.

Speaker 2 (00:06):
Yeah, look, another tough thirteen weeks. This is thirteen weeks
odd number on a to the second. In November they
salved there were six hundred and seventy four million. That
was on the zero point nine percent on the previous
corresponding period. If we strip out the number of stores
are open and the number of different days, it was
pretty much flat plus zero point one. So pretty tough.
Salor's environment is continuing for the warehouse. The red seed

(00:29):
margins down a little bit, obviously very competitive out there.
They did announce a costs reset program. They're aiming to
reduce their cost of doing business to below thirty one
percent of sales, down from thirty two point two. But
the market was a bit weirre about it. Sheprice that
we ship plosed down on zero point six percent to
seventy nine seventy nine a half ashes there.

Speaker 1 (00:50):
Ron Now the psize still well. That the warehouse might
have groceries to sell soon, We'll have to wait and
see about that. Hey, the p sign number we got today,
so we've got manufacturing on Friday, that's now positive territory great,
but the PSI is still not a bit better but
still contracting.

Speaker 2 (01:06):
That's right. So performance of Services Index, it measures monthly
the survey of the services industry. It's really indicator on activity.
If it's about fifty, it means it's expanding this below
to debts contracting. It increased on the October month, that
went up to forty eight point seven, up zero point four,
so up, but still because it's below fifty, it's still

(01:27):
indicates that sector is still in tough times. It's still contracting.
And you're right, if we combine the services index with
that more positive manufacturing index last week, we're starting to
get to the point rund where we're getting some positive indicators.
The combo of the two suggesced we get economic growth
starting to come through.

Speaker 1 (01:47):
Right, We're looking very busy week for mark and we're
both here and internationally as well. What are you looking
for that in video result will be good, Yeah, that will.

Speaker 2 (01:55):
Be a really important way. So we've gone into this
week pretty nervous markets for pretty weak last week in
inconductor manufacturer and videos results out Wednesday in the US
Thursday morning, New Zealand Time and that it provides some
real fuel for this AI investment theme. As I said
last week, the US share markers were dragged down by
this tech sector. So really important that in video comes

(02:17):
out with an okay sort of an update. In fact
day is probably not going to be enough, will have
to be a good update. We've also got the reopening
of the US government data coming through other shutdowns closed
from shutdowns open, I should say, so this will give
us some more information as to whether there's inflation data
that stops the US Federal Reserve from cutting rates, remembering

(02:37):
the markers expecting the feed to keep cutting rights by
about three quarters of a percent. And so on Thursday
in the US Friday morning zeon time, we'll get the
job data out from September. Consensus is for eighty thousand additions.
The risk is it's either too hot so the Fed
doesn't cut. And then locally, we've got nine companies producing profities,

(03:00):
including companies like Sanford, Circo, Napier, port Oceania in seven
companies filding and engaging our meetings Precinct A two, Goodman,
Sky Telly. The big ones key question for investing is
going to be are the green shoots crowing. Are we
actually seeing them turn into a decent jesy crop?

Speaker 1 (03:17):
We want to see plenty of green Shaine. Thank you, Shane.
Sally Harbor a sit management with us tonight. For more
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