1 00:00:05,120 --> 00:00:06,560 Speaker 1: This is what the flucks. 2 00:00:06,640 --> 00:00:09,520 Speaker 2: I'm Brandon, I'm justin and it's Monday, twenty fifth of August. 3 00:00:09,600 --> 00:00:13,119 Speaker 1: Jazzy Boy, Apple and Google the cage fight it rolls on. 4 00:00:13,520 --> 00:00:16,360 Speaker 1: In Google's latest phone release, They've added an AI camera 5 00:00:16,480 --> 00:00:19,279 Speaker 1: coach that tells you the best framing and lighting for 6 00:00:19,320 --> 00:00:21,760 Speaker 1: your picks. And just to rub salt into the wound, 7 00:00:21,880 --> 00:00:25,760 Speaker 1: Google's running ads poking fun and Apple's AI without ever 8 00:00:26,040 --> 00:00:29,200 Speaker 1: saying the word Apple. Meanwhile, I'm just happy if Siri 9 00:00:29,320 --> 00:00:31,840 Speaker 1: manages to set my alarm without any glitches going on. 10 00:00:32,080 --> 00:00:35,120 Speaker 2: True, man, nothing says happy birthday like free food and 11 00:00:35,280 --> 00:00:37,960 Speaker 2: free drinks from your favorite retailers. And today, in the 12 00:00:38,000 --> 00:00:40,519 Speaker 2: Flux app, we've just released an article of the fifteen 13 00:00:40,600 --> 00:00:43,560 Speaker 2: food and drink freebies that you can snag on your birthdays. 14 00:00:43,680 --> 00:00:45,600 Speaker 2: Make sure to check it out and save the list 15 00:00:45,680 --> 00:00:47,600 Speaker 2: for when your birthday rolls around. 16 00:00:47,720 --> 00:00:51,360 Speaker 1: Three celebratory stories today, Juzzy boy, let's do it for 17 00:00:51,520 --> 00:00:56,040 Speaker 1: our first. Gusmin Egomez shares have tumbled nineteen percent after 18 00:00:56,080 --> 00:00:59,600 Speaker 1: its sales growth fell short of its big expectations. 19 00:01:00,240 --> 00:01:03,120 Speaker 2: Walk grab the popcorn. This one has got real spicy, 20 00:01:03,120 --> 00:01:04,319 Speaker 2: b man, So tell me more. 21 00:01:04,240 --> 00:01:08,679 Speaker 1: All right, So Cousmini Gomez Akagyg is the Mexican fast 22 00:01:08,680 --> 00:01:11,480 Speaker 1: food chain that started in Sydney in two thousand and six. 23 00:01:11,240 --> 00:01:13,600 Speaker 2: And now dishes up burritos and bowls in more than 24 00:01:13,640 --> 00:01:15,800 Speaker 2: two hundred and ten restaurants across Australia. 25 00:01:15,880 --> 00:01:19,360 Speaker 1: Joseiboit. GYG listed in twenty twenty four at evaluation of 26 00:01:19,440 --> 00:01:21,399 Speaker 1: two point two bill and it was the biggest and 27 00:01:21,480 --> 00:01:23,240 Speaker 1: most controversial IPO of the year. 28 00:01:23,319 --> 00:01:25,920 Speaker 2: Yep. Some investors were convinced this was about ten times 29 00:01:25,959 --> 00:01:26,800 Speaker 2: overpriced and. 30 00:01:26,880 --> 00:01:29,480 Speaker 1: Other investors thought it was a tasty bargain. But now 31 00:01:29,600 --> 00:01:33,000 Speaker 1: twenty months after its IPO, investors have got some chili 32 00:01:33,040 --> 00:01:36,280 Speaker 1: sweats yep. GYG revealed its sales in the first seven 33 00:01:36,319 --> 00:01:40,000 Speaker 1: weeks of FI twenty six grew just three point seven percent. 34 00:01:39,680 --> 00:01:42,720 Speaker 2: And that was well below the market expectations of seven 35 00:01:42,760 --> 00:01:44,440 Speaker 2: point six percent growth and josieboit. 36 00:01:44,600 --> 00:01:48,280 Speaker 1: These results sent to GYG shares diving nineteen percent in 37 00:01:48,320 --> 00:01:49,600 Speaker 1: a single day last week. 38 00:01:49,800 --> 00:01:52,160 Speaker 2: In fact, be man, their share price is back near 39 00:01:52,400 --> 00:01:54,160 Speaker 2: the ipo price of twenty two bucks. 40 00:01:54,240 --> 00:01:57,640 Speaker 1: It's not all soggy natchos, though. GYG cracked one billion 41 00:01:57,680 --> 00:02:00,280 Speaker 1: dollars in sales for the very first time I'm in 42 00:02:00,400 --> 00:02:01,480 Speaker 1: Fya twenty five. 43 00:02:01,320 --> 00:02:04,120 Speaker 2: And it's and its same store sales in Australia rose 44 00:02:04,160 --> 00:02:07,600 Speaker 2: nearly ten percent, but its US operations have become a 45 00:02:07,840 --> 00:02:12,600 Speaker 2: halapino field headache. Yeah, their losses doubled over thirteen million bucks, 46 00:02:12,720 --> 00:02:15,280 Speaker 2: and the man with their new store openings, it's expected 47 00:02:15,280 --> 00:02:18,600 Speaker 2: that the losses will deepen even more. Next minute, investors 48 00:02:18,760 --> 00:02:21,959 Speaker 2: ran for the Clinder with shares dropping nineteen percent. 49 00:02:22,120 --> 00:02:26,440 Speaker 1: Oh my god, Salita Salada Salida is exiting in Spanish. 50 00:02:27,240 --> 00:02:31,000 Speaker 1: Next minute, investors ran for the Salida with shares falling 51 00:02:31,120 --> 00:02:31,840 Speaker 1: nineteen percent. 52 00:02:31,919 --> 00:02:33,320 Speaker 2: So what is the key leading here? 53 00:02:33,520 --> 00:02:36,799 Speaker 1: Success at home doesn't always translate overseas. 54 00:02:37,040 --> 00:02:40,200 Speaker 2: Man. Remember when gag was ipoing and it pitched itself 55 00:02:40,240 --> 00:02:43,239 Speaker 2: as a global competitor in the Mexican fast food market. 56 00:02:43,360 --> 00:02:45,840 Speaker 1: I do. It had plans to scale in markets like 57 00:02:45,919 --> 00:02:47,320 Speaker 1: Singapore and Japan and. 58 00:02:47,280 --> 00:02:51,320 Speaker 2: Most ambitiously, the Big Enchilada aka the United States. 59 00:02:50,960 --> 00:02:53,040 Speaker 1: And investors did love that idea. 60 00:02:53,120 --> 00:02:55,200 Speaker 2: Yeah, but now that it's racking up big losses, some 61 00:02:55,360 --> 00:02:57,320 Speaker 2: investors are losing faith already. 62 00:02:57,360 --> 00:02:59,960 Speaker 1: And Jazzy Boys, success at home doesn't always translate over sea. 63 00:03:00,320 --> 00:03:02,920 Speaker 2: Yeah. Think of Starbucks, which dominates in the US and 64 00:03:03,000 --> 00:03:06,239 Speaker 2: came to Australia in two thousand with its Grande American 65 00:03:06,280 --> 00:03:07,200 Speaker 2: business model. 66 00:03:07,000 --> 00:03:09,040 Speaker 1: And after eight years it closed two thirds of its 67 00:03:09,080 --> 00:03:11,800 Speaker 1: stores because it struggled to adapt to the local environment. 68 00:03:11,840 --> 00:03:14,560 Speaker 2: So b Man Gog needs to balance their ambition for 69 00:03:14,600 --> 00:03:17,280 Speaker 2: growth with the realities and costs of scaling abroad. 70 00:03:17,320 --> 00:03:21,520 Speaker 1: And if they don't, investors, maybe jumping off this burrito for. 71 00:03:21,600 --> 00:03:25,400 Speaker 2: Our second story. Fonterra is selling off its mainland cheese 72 00:03:25,440 --> 00:03:28,240 Speaker 2: and butter brands to a French dairy giant in a 73 00:03:28,400 --> 00:03:31,239 Speaker 2: three point eight billion New Zealand dollar deal. 74 00:03:31,440 --> 00:03:33,840 Speaker 1: Say cheese, jusey boy, and say a little bit of 75 00:03:33,840 --> 00:03:35,040 Speaker 1: bonjour as well. 76 00:03:35,080 --> 00:03:38,080 Speaker 2: Tell me more, okay. So Fonterra is New Zealand's massive 77 00:03:38,320 --> 00:03:40,880 Speaker 2: dairy co op. It was founded in two thousand and one. 78 00:03:40,800 --> 00:03:43,400 Speaker 1: And one of the biggest dairy exporters. 79 00:03:42,880 --> 00:03:45,600 Speaker 2: In the world. And you may know Fonterra's mainland group 80 00:03:45,600 --> 00:03:48,160 Speaker 2: because it makes some of the Aussie and Kiwi staples 81 00:03:48,160 --> 00:03:49,560 Speaker 2: that you've probably got in your fridge. 82 00:03:49,800 --> 00:03:53,560 Speaker 1: Right now, we'd be talking mainland cheese, it's just perfect 83 00:03:53,560 --> 00:03:55,680 Speaker 1: Italiano and Western Star butter. 84 00:03:55,840 --> 00:03:59,680 Speaker 2: But now Fonterra has sold its mainland group consumer brands 85 00:03:59,720 --> 00:04:03,240 Speaker 2: to the French dairy behemoth Lactalis the three point eight 86 00:04:03,280 --> 00:04:06,360 Speaker 2: billion New Zealand dollars. And who are these lactiles folks 87 00:04:06,360 --> 00:04:06,840 Speaker 2: you speak of? 88 00:04:07,040 --> 00:04:10,880 Speaker 1: They own Cracker Barrel and about twenty other European cheese brand. 89 00:04:10,680 --> 00:04:12,920 Speaker 2: And in Australia they're the owner of Paul's Milk and 90 00:04:13,040 --> 00:04:14,320 Speaker 2: Oak's Flavored Milk as well. 91 00:04:14,320 --> 00:04:16,000 Speaker 1: The world's largest dairy company. 92 00:04:16,040 --> 00:04:21,000 Speaker 2: And interestingly, b maan Fonterra considered listing mainland on the ASX. 93 00:04:20,400 --> 00:04:22,880 Speaker 1: But then it got into a hot bidding war and 94 00:04:22,960 --> 00:04:25,719 Speaker 1: decided that a trade sale offered the best value. 95 00:04:25,720 --> 00:04:27,839 Speaker 2: Interesting, So what is the key learning here? 96 00:04:27,880 --> 00:04:30,080 Speaker 1: When a company wants to sell off a division, it 97 00:04:30,240 --> 00:04:33,279 Speaker 1: needs to weigh up the two main avenues of selling 98 00:04:33,320 --> 00:04:35,640 Speaker 1: out a trade sale or an IPO. 99 00:04:35,800 --> 00:04:37,880 Speaker 2: A trade sail means selling to another company. 100 00:04:37,920 --> 00:04:40,920 Speaker 1: It's often a strategic buyer in the same industry who 101 00:04:40,920 --> 00:04:43,560 Speaker 1: sees value in quoing their entire portfolio. 102 00:04:43,680 --> 00:04:45,680 Speaker 2: And the benefit of this is it's usually done with 103 00:04:45,760 --> 00:04:47,080 Speaker 2: speed and with certainty. 104 00:04:47,120 --> 00:04:49,200 Speaker 1: But it's hard to know whether you actually get the 105 00:04:49,240 --> 00:04:51,320 Speaker 1: best price if you're the seller because they never went 106 00:04:51,360 --> 00:04:52,360 Speaker 1: to the public market, and. 107 00:04:52,320 --> 00:04:54,880 Speaker 2: Of course bman, if you ipo, that's when you split 108 00:04:54,920 --> 00:04:57,760 Speaker 2: out the division and list it on a stock exchange. 109 00:04:57,279 --> 00:04:58,840 Speaker 1: And it allows investors to buy in. 110 00:04:58,920 --> 00:05:01,960 Speaker 2: IPOs can potentially unlock higher long term value if the 111 00:05:01,960 --> 00:05:04,279 Speaker 2: market's hot, but they're riskier and they're slower. 112 00:05:04,320 --> 00:05:07,520 Speaker 1: In other words, Fonterra avoided rolling the dice on market 113 00:05:07,600 --> 00:05:08,200 Speaker 1: sentiment and. 114 00:05:08,240 --> 00:05:10,520 Speaker 2: Chose the certainty of cash in hand today. 115 00:05:10,720 --> 00:05:13,960 Speaker 1: For our third and final story, shares in Ingham's, the 116 00:05:14,040 --> 00:05:17,240 Speaker 1: chicken wholesale supplier, have taken a roasting due to a 117 00:05:17,279 --> 00:05:19,760 Speaker 1: breakdown in its relationship with Woolworths. 118 00:05:20,160 --> 00:05:22,200 Speaker 2: The investors have come home to roost b Man and 119 00:05:22,240 --> 00:05:25,280 Speaker 2: they aren't exactly clucking. So tell me more so. 120 00:05:25,480 --> 00:05:29,159 Speaker 1: Ingham's is Australia's largest chicken process out founded by Walter 121 00:05:29,360 --> 00:05:32,120 Speaker 1: Ingham back in nineteen eighteen, and it has over two. 122 00:05:32,080 --> 00:05:35,080 Speaker 2: Hundred and eighty six facilities across Australia and pretty much 123 00:05:35,080 --> 00:05:36,520 Speaker 2: supplies chicken everywhere. 124 00:05:36,520 --> 00:05:40,000 Speaker 1: We're talking supermarkets, restaurants, fast food chains across Australia and 125 00:05:40,040 --> 00:05:40,640 Speaker 1: New Zealand. 126 00:05:40,640 --> 00:05:43,520 Speaker 2: But BMN Ingham saw it shares plunged twenty percent in 127 00:05:43,560 --> 00:05:45,960 Speaker 2: a single day last week, or two hundred and sixty 128 00:05:46,040 --> 00:05:48,880 Speaker 2: milli in value. And what was the reason, mister expert, Well, 129 00:05:48,960 --> 00:05:52,480 Speaker 2: their fo twenty five numbers were pretty undercooked. Revenue down 130 00:05:52,520 --> 00:05:54,599 Speaker 2: one and a half percent, but net profit was down 131 00:05:54,720 --> 00:05:55,320 Speaker 2: ten percent. 132 00:05:55,360 --> 00:05:58,159 Speaker 1: You see Juzi boit Woolly's, its biggest customer, decided to 133 00:05:58,360 --> 00:06:01,400 Speaker 1: diversify away to other suppliers. 134 00:06:00,920 --> 00:06:03,960 Speaker 2: Which means Ingham's had too many chickens which were dumped 135 00:06:04,000 --> 00:06:05,400 Speaker 2: into the wholesale. 136 00:06:04,960 --> 00:06:06,839 Speaker 1: Market and that really hurt their margins. 137 00:06:06,880 --> 00:06:08,279 Speaker 2: So what is the key learning here? 138 00:06:08,400 --> 00:06:12,600 Speaker 1: Customer concentration risk occurs when a company relies heavily on 139 00:06:12,600 --> 00:06:15,400 Speaker 1: one or just a few customers for the bulk of 140 00:06:15,480 --> 00:06:16,680 Speaker 1: its revenue. 141 00:06:16,320 --> 00:06:18,920 Speaker 2: And be man. It leaves those companies vulnerable if their 142 00:06:18,920 --> 00:06:22,919 Speaker 2: customers change contracts or renegotiate terms, or just cut volumes, 143 00:06:22,920 --> 00:06:23,520 Speaker 2: like Woolies. 144 00:06:23,560 --> 00:06:26,839 Speaker 1: So while Woolies is still their biggest customer, cutting volumes 145 00:06:26,880 --> 00:06:30,040 Speaker 1: has really hurt Ingham's sales and margins and share price. 146 00:06:30,160 --> 00:06:33,000 Speaker 1: That's because a high customer concentration can often be a 147 00:06:33,040 --> 00:06:34,760 Speaker 1: signal of risk for an investor. 148 00:06:34,920 --> 00:06:37,920 Speaker 2: Fox Sam, there are hundreds of dollars worth of preebees 149 00:06:38,040 --> 00:06:39,920 Speaker 2: on your birthday that you can get from a whole 150 00:06:40,040 --> 00:06:42,560 Speaker 2: range your blut and drink retailers. We're talking Boost Juice, 151 00:06:42,600 --> 00:06:45,240 Speaker 2: Flora Gene and fifteen others as well. If you want 152 00:06:45,240 --> 00:06:47,240 Speaker 2: to know how you can scourse some major freebies on 153 00:06:47,240 --> 00:06:49,240 Speaker 2: your birthday, make sure to download the Flux out and 154 00:06:49,279 --> 00:06:49,960 Speaker 2: save the article. 155 00:06:50,040 --> 00:06:52,400 Speaker 1: Thanks for listening, and we'll see you on Wednesday.