Lawmakers' report into "appalling" working practices at Sports Direct makes grim reading for founder and controlling shareholder Mike Ashley.
But so does the Sports Direct share price.
Ashley won over members of parliament probing the working conditions at the company last month, with the value of his holdings gaining $19 million during his testimony, Gadfly noted.
Shares had already given up all their gains from his unexpected star turn. On a price to earnings basis, the valuation is now almost half of that of rival JD Sports. Until a year ago, they traded at a healthy premium.
For Ashley, who holds 55 percent of shares, that's a loss of almost a billion pounds ($1.3 billion).
The sell-off at Sports Direct reflects profit warnings due to poor weather and generally difficult conditions for retailers, as well as the company's failure to hedge its exposure to the dollar.
That oversight is curious, given the well-publicized risk that a British departure from the European Union could pummel the pound. That will hurt its profits since the cost of buying dollar-denominated goods from Asia rises as sterling weakens.
The share slump also probably reflects some of the bad publicity around working practices at the company. Consumers love a bargain, but, it seems, they also prefer a company to treat its workers with dignity.
The working practices outlined by the lawmakers -- including penalties for taking a drink of water outside set break times and health and safety breaches that led to repeated ambulance calls to the Shirebook warehouse, including in one case for a woman giving birth in the company bathroom -- aren't going to enamor consumers of Sports Direct's cheap sports clothing and shoes.
Ashley is just the sort of senior executive that Prime Minister Theresa May is taking aim at with promises to hold unscrupulous bosses to account. And the parliamentary report published this morning faults him for poor practices at the company.
While the lawmakers' criticism may sting, the pain in his wallet is undeniable.
Pressure on Sports Direct shares doesn't look likely to ease anytime soon. Minority holders have been pressing for improvements in corporate governance, and have grown wary of the current arrangements, where Ashley seems pretty much to do what he wants.
Ashley pledged to review this when he appeared before lawmakers last month, and institutional investors have taken note. This could be another flashpoint at the company's annual meeting in September.
Taking Sports Direct private is one option for Ashley, and it would be more affordable for him now given the drop in the value of the stock -- it's now below the original 3 pound offer price.
That wouldn't improve the lot of workers, but it would shield Ashley from the sort of public scrutiny he's come under over the last year.
Until then, external shareholders look like a more powerful force for change than all the lurid headlines about "Victorian" working practices.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
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