Pureplay retailer Kogan has posted a strong first quarter result, buoyed by breaching the one million active customer mark in August.
In an announcement today, the company said strong trading momentum in during the first quarter of FY18 resulted in the business outperforming management budgets.
During the trading period, revenue growth increased 35.9 per cent while gross margin of 18.2 per cent in the quarter was up compared to 17.9 per cent on the first quarter of FY17.
EBITDA growth of 37.7 per cent was achieved for the quarter.
“By continuing to delight our growing customer base with our various long term business strategies, we are pleased to deliver a trading update that demonstrates ongoing strong year-on-year growth in revenue and profitability, said founder and CEO Ruslan Kogan.
“Our new verticals continue to shine and attract customers with our compelling offering – Kogan Mobile had impressive growth this quarter and, in October, celebrated its second birthday with an exceptionally popular promotion. Also, Kogan Insurance is off to a promising start after launching in August.”
“With a significant investment in high quality inventory, and an exciting line-up of new product releases and promotional offers to be rolled out over the coming quarter, we are better poised than ever to help out Santa Claus this Christmas.”
Industry analysts at IBISWorld are anticipating subdued growth over December to cap off a weak 1.9 per cent annualised growth figure for the retail sector in 2017, on expectations that the holiday season won’t loosen purse strings as well as it usually does.
“When it comes to Christmas, people are usually willing to spend even though they are uncomfortable with their finances, [but] we’re starting to see that consumers are getting pushed in terms of how much they can actually spend,” IBISWorld senior industry analyst Nathan Cloutman said.
Cloutman also says online shopping, which is flagged to grow by an annualised 9.4 per cent in 2017, will put even more pressure on margins this year than last as the relevance of e-commerce as a more convenient and cheaper option for time-poor Christmas shoppers becomes more pronounced.
