This is what the flux. I'm brttman, I'm justin and it's Wednesday, this thirtieth of Bucktober does the boy. You may think that Halloween is the spookiest thing going around this week, but there is something a little bit spooky app Zombie Companies. That's companies showing signs of financial distress but managing not to collapse.
Now.
According to KPMG Australia, the number of ASX listed zombies has spiked by thirty one percent in just the last six months. And I'm calling this one chabooki shaboogiesh woogie fox fam.
Did you know the ASX two hundred has returned eight point one percent in twenty twenty four so far, And I must say it is quite surprising to see who some of the winners are and some of the losers. We have it all covered in the Flux out to make sure to download the app and find out who is leading the charge.
Three dulcet tone stories today Juzzy Boy for our first. Maya is the new owner of Just Jeans, JJ's and Dotty clothing brands after agreeing to merge with parts of Premiere Investments.
Wowe department sort more Maya, So tell me what's going on here? Be man So does it? Wait? We know?
Maya is the department store that's been selling men's and women's clothing since nineteen hundred, if you don't mind.
And while Maya and David Jones were pretty invincible back in the day, the last fifteen years have been much less kind.
Now DOESI wait? We know that Maya listed on the ASX at evaluation of two point two billion dollars in two thousand and nine, but has dropped by about sixty six percent since then.
The Beman Meyer is now working hard to claw back its relevance and revenue yep.
It has announced that it's going to merge with certain parts of Premier Investment's business.
Basically, myyle now own brands like Just Jeans, JJ's, Dotty.
Don't you dever forget Portman's and Jackie E.
And in exchange, Maya will give Premier Investors roughly thirty percent of Maya shares plus a little eighty two million bucks in cash.
And when you whack the Maya one loyalty program onto these brands, you can start to understand the opportunity for Maya.
The v Man. Off the back of this news, Premier investors share price jump more than twelve percent and Maya's dropped by one percent.
Oh interesting, seems like investors were really quite pleased to dish off these brands.
So true, So what is the key learning here?
One company's trash maybe another company's treasure.
You see, b Man, Well, brands like just Jean's and JJ's. They may lack glamour, they still wake in close to eight hundred million dollars in revenue over the last financial year.
It means that Maya can now offer its loyalty program to millions of more Australians.
Get this, b Man. My's loyalty program called Maya One has more than ten million members right now and one of the.
Key items on Maya's new CEO's wish list is to improve the loyalty program.
If you remember, she came from Quantus and built its loyalty program into a seriously big business.
So she's already poached to executives from Quantus's loyalty program over to Maya.
And snagged five new brands into Meyer's portfolio.
And with this new merger, the Maya board and investors are hoping that the new CEO can revitalize their loyalty program and bring in the big bucks with a bit of glamour. For our second story, Zipco has seen the chair price jump more than ten percent after announcing its focus on profitability. Is paying off.
Zip bouncing back harder than a Black Friday shopper turning for Cyber Monday. So what is going on?
Some background, juzzy boy. Zip Co was founded in twenty thirteen, as of course, one of the og buy now, pay later companies in Australia.
Even slightly before after pay.
I know now. Since then it's grown to over six million customers around the world. That man, it hasn't been all daffidils and rainbows for zip Now. It went on a bit of an acquisition spree between around twenty sixteen and twenty twenty two. They acquired by Now pay, Lata providers and other FinTechs as well.
We're talking Spotty in the Middle East, Twister in Europe. Don't you forget ye old pocketbook here in Australia. But then boom, interest rate shut up and investors suddenly cared a whole lot more about profits rather than promises.
Zip shares drop from twelve dollars thirty five all the way down to twenty seven cents, about a nine eight percent drop.
Wow. But over the past two years, ZIP has cut the fat and focused solely on its Australia and New Zealand.
Business and also growing in the US.
And now Zip's announced a quarterly ebitdat of nearly thirty two millions macaroni.
And Juzzy Boy. Off the back of this news, ZIP share prices jump more than ten.
Percent and grown more than eight times in the past twelve months.
Largely off the back of that U growth and their excess spread growing by over six percent in Australia.
So what is the key landing here?
Excess spread is the margin a financial company earns after covering its borrowing costs. Now, Zip doesn't just magically pullcash from thin air. It borrows from banks and lenders and fund managers.
So a growing excess spread means they're either managing their borrowing rates well, or.
They're increasing the interest rate on their products, or a mix of boats and jay Boy with zip code now profitable. It's clearly got investors quite relieve.
Yeah, because it means in a lower interest rate environment, it's excess spread should.
Be even wider, meaning even better margins.
For our third and final story, Volkswagen is looking to cut thousands of jobs as part of a major cost cutting overhaul. But they've got one major speed bump in the way.
Oh, jusey boy. Clearly it's not the best of days for old Volkswagen. What is happening right here?
So Volkswagen or Volkswagen, Yes, the German car company that was founded back in nineteen thirty seven.
It's been most well known for the iconic beet Or car, and in twenty sixteen to twenty seventeen it was the largest car maker worldwide.
But lately, b Man Volkswagen has been doing it quite hard.
We're talking the enormous cost of transitioning to electric vehicle as.
Well as intense competition from Chinese car makers.
Indeed, and now jazy boy, Volkswagen is allegedly planned to shut down at least three factories in Germany and lay off tens of thousands of employees.
All part of a major cost cutting initiative to revamp the company. But be man, stop right there, because Volkswagen's workers council isn't just letting this slide and they're putting up a fight against this decision.
They've been in some hectic negotiations with Volkswagen to protect employees.
They've even threatened for all employees to strike if their needs aren't met.
So what is the key learning here?
Poor labor relations can be impactful enough to destabilize a whole company.
Yeap Labor relations is basically a relationship between company management and its workers.
Who are often represented by the unions and be Man. With Volkswagen facing serious financial challenges, it can often amplify its conflict with its employees. In fact, be Man, we saw something quite similar happened back in twenty nineteen with General Motors.
YEA, forty eight thousand employees went on strike over issues like job security and better pay. And that strike went for over forty days. And get this ended up costing General Motors over two billion US dollars and Jesse Wait, Volkswagen's bound to cop some financial damage through this conflict, but we'll have to wait and see just how bad it all is.
Bucks Out. The ASX has returned eight point one percent for the first nine months of this year, and there is one particular stuff that has searched. If you want to know more about what's going on and where the key movers are. Make sure to download the flucks app and check out the best and worst performing sectors on the ASX, and.
No doubt about it, you'll be winning at money.
Thanks for listening and we'll see you on Fridays.