Pittards (LON:PTD) is a ‘premium leather and leather products’ brand, based partially in the UK and partially in Ethiopia. They seem to make a pretty broad range of products, with ‘technically advanced’ leathers being a common phrase in their annual report. That said, first thoughts are that it sounds like a commodity business; as the board quite reasonably puts it:
“The leather industry is a global business: wherever countries have meat and dairy industries then hides and skins are produced as by-products.”
And while I’m not an expert on the industry, or any industry for that matter, I would imagine the economics of having relatively dispersed raw materials would lend itself to having a relatively dispersed market structure. Pittards is by no means a particularly big company, which might lend weight to this theory. The attraction isn’t as immediately evident as it sometimes is, then; we don’t have an obviously defensible market position, a leading company in a niche or similar.
The eternal temper
The attractive factor is the usual – the price. It’s trading at a decent discount to the assets in the business, and it’s profitable, too. Those two factors…
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