Long4Life CEO: Here’s where we see expansion opportunities
Investment firm Long4Life has reported a 75.5 per cent drop in interim profit, following a significant disruption on all group businesses, due to COVID-19. Long4Life - which owns Sportsmans Warehouse and Sorbet - has reported that trading profit for the six-months ended August declined to R49.1 million. Group revenue fell by 22.6 per cent to R1.4 billion. Long4Life CEO, Brian Joffe joins CNBC Africa for more.
Wed, 21 Oct 2020 10:49:16 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The challenges of making acquisitions in a poor market environment due to the company's limited acquisition capacity and poor market rating
- The potential for expansion in new market segments, particularly in the healthcare and beauty sectors, to enhance the company's portfolio
- The importance of adapting to evolving market trends and consumer behavior, as well as effectively managing stock levels and competition during the pandemic
Investment firm Long4Life, which owns Sportsmans Warehouse and Sorbet, has recently reported a significant decline in interim profit due to the impact of COVID-19 on its group businesses. The CEO of Long4Life, Brian Joffe, joined CNBC Africa to discuss the challenges faced by the company and the potential expansion opportunities moving forward. Despite the disruptions caused by the pandemic, Joffe remains optimistic about the future and sees potential for growth in new market segments.
Joffe acknowledged that the current portfolio of the company is not yet complete, citing the difficulties of making acquisitions in a challenging market environment. He noted that the poor market rating of the company limits their acquisition capacity to about one and a half billion. Joffe explained that the company is constantly evaluating whether it is more beneficial to invest in itself or to pursue external acquisitions to drive growth.
When asked about potential areas for expansion, Joffe emphasized the company's focus on the lifestyle business, particularly in the healthcare and beauty sectors. He mentioned the ongoing small add-on acquisitions within the existing segments but expressed interest in entering new spaces to broaden the company's reach.
In response to questions about the current market conditions and the concept of 'normal,' Joffe highlighted the ever-changing nature of the business environment. He emphasized the importance of adapting to evolving consumer behavior and market trends, citing the shift towards home-based activities such as camping as a result of the COVID-19 pandemic.
Regarding stock management during the pandemic, Joffe stated that the company is focused on maintaining the quality of its goods and ensuring that stock levels are optimized. He mentioned that margins and demand levels are relatively stable compared to the pre-COVID period, indicating a positive outlook for the company's performance.
When discussing competition in the current market landscape, Joffe acknowledged that while some competitors may have weakened due to financial constraints, competition remains present. He noted that companies with strong financial positions are better equipped to navigate the challenging business environment.
Overall, Joffe's insights during the interview shed light on Long4Life's strategic approach to growth and resilience amidst the ongoing challenges posed by the pandemic. While the company has faced disruptions and a decline in profit, Joffe remains optimistic about the opportunities for expansion and continued success in the future.