Temple & Webster continues turnaround
Temple & Webster, has continued its turnaround with revenues on the rise and margin improvements seen in it’s full year guidance announcement released today.
The furniture and homewares retailer has forecast its FY17 revenue forecast to be $63.5m ‐ $64.5m, up four per cent year-on-year on a pro forma basis and 10 per cent on a continuing business basis, excluding the Milan Direct UK operations that the company exited early in FY17.
FY17 EBITDA forecast to be a loss of $6.8m ‐ $7.3m, an improvement of over 50 per cent year-on-year.
“Q4 FY17 will be our strongest quarter in our turnaround journey,” said Temple & Webster co-founder and CEO Mark Coulter.
The retailer has reduced its Q4 EBITDA loss to ~$0.5m, from a loss of $3.1m in the prior year corresponding period.
“We again grew revenues while improving our margins and cost base, and continue to make great progress on all our key metrics,” said Coulter.
“These improvements have lowered the revenue runrate required to reach profitability to ~$79m on Q4 metrics.
Given our full year revenue guidance of $63.5m-$64.5m and our current growth rate, we are confident of reaching profitability during CY18, with FY19 being our first full year of profit”.
“With a forecast cash balance of $8.0‐$8.5m at June 30, and a significant reduction in our EBITDA loss per quarter we are also comfortable that we have the existing cash reserves to meet our current plans” said Coulter.
“With over 130,000 products for sale, Temple & Webster has the largest range of any retailer in our category in Australia. Our relentless focus to deliver beautiful solutions for our customers’ homes and work spaces is the reason we are the number one online retailer in our category by quite a long way,” said Coulter.
Coulter said the company had iimproved its contribution margin to 14.8 per cent (after marketing), and reduced fixed cost base from $14.7m to $11.7m.
“On these metrics (which we hope to still improve), we now need to generate $79m top line to break even,” he said.
“Our current growth will get us to break-even from a run rate perspective during next calendar year, with first full year of profit in FY19”
The online furniture and homewares retailer has launched its first outlet store in Richmond, Melbourne, as the brand adds “offline” to its homewares and interiors services.
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