Debt-free MySale says annual sales slide
Profitable and debt free are two elements to any results statement worth opening with in Covid-crushed times like these. So it’s little wonder Australia-based international online retailer MySale Group was in an upbeat mood Thursday.
The London Stock Exchange-listed company also noted its fashion platform is now “being used by even more international brands” as it pursues a more Southern Hemisphere focus, CEO Carl Jackson said.
He talked of a “transformative year” that saw the business closing its UK operations to refocus on the Australia/New Zealand-First (ANZ) strategy while developing an “inventory light marketplace platform”.
The business also “successfully recapitalised, restructured and repositioned our business, significantly reducing the cost base, enhancing our quality of revenue [and] increasing product margins”.
The end result? “We are operating on a profitable, cash generative and debt-free basis” as of the end of October to the tune of A$15.9 million after raising A$23.3 million, he added. He also noted trading in the first four months of the current financial year has continued very much in the same vein.
And sales? Not so hot. Final results for the year to 30 June showed revenues declined to A$130 million from A$208.3 million a year ago, although MySale stressed that the “quality of revenues improved” alongside “substantial improvements" to its gross margin, which increased 8.4% to 33.5%.
“We anticipate further improvement in gross margin during FY21” Jackson added.
Meanwhile, underlying EBITDA loss was “significantly reduced” to A$2.7 million from A$18.8 million a year ago. The pre-tax reported loss was cut to A$3.4 million from A$52.2 million last time. Its transformation programme also saw the cost base reduced by 48.1% to A$50.2 million.
All those (mostly) positives have left the group in an “excellent position” to accelerate the execution of its “highly-focused, high-growth” ANZ-First strategy. It's a shift that has also resulted in the closure of its UK and US warehouses and the relocation of its Australian Fulfilment Centre.
As mentioned above, the group also increased the number of new active international partners to 982, noting the newcomers (no actual figure here) were “looking to take advantage of its Southern Hemisphere customer base and the associated counter seasonal inventory opportunity.
“As we enter FY21 more UK and US brands are now working on the MySale platform as we provide an efficient counter seasonal solution for their excess inventory”, it said.
Its ANZ focus means the group is also evaluating the potential benefits of dual listing the Group on the Australian Stock Exchange, it noted.
Apart from honing its on-going saving programme, the outlook focuses on increasing the amount of high margin own-stock inventory while adopting a breadth-not-depth "test and repeat strategy”.
It also said the group is “well positioned to benefit from ongoing supply chain disruption and the continued strengthening of the ANZ off-price channel”.
Chairman Charles Butler added: “The world of e-commerce has changed off the back of the pandemic and it has caused the structural shift from physical retail to online to accelerate significantly with many people shopping online for the first time. I believe this change is here to stay and e-commerce will continue to see strong continued growth for a long time to come”.
He added: “Trading in the current year has started well and with the continued focus on customer experience and providing brands and retailers with a world class platform to access that customer, we are excited about the journey ahead”.
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