Gear4music [IRDX RGRM] today said it was focused on investing in its “people, products, websites and operational capabilities” as it reported growing sales in the first half of its financial year.
The Top150 retailer in IRUK Top500 research, said that global sales of £31.2m were 44% up on the same time last year. UK sales of £17.9m were 30% up on the same time last year in the six months to August 31, while sales from Europe and the rest of the world came in at £13.3m, 70% up on last time.
Active customer numbers rose at the same time, growing by 44% to 390,000. Gear4music said its distribution centres in Sweden and Germany had made a “strong start”, although investment costs had held down profit margins in the short term. But it said it would continue to invest in order to deliver sustainable growth in the long term.
Gear4music chief executive Andrew Wass said: “We are very pleased with our trading performance over the last six months, with 44% revenue growth being ahead of our expectation for the first half as indicated at the start of the year, and equates to two-year growth of 150%.
“Revenue growth in our core UK market continues to be strong, alongside very strong growth in our international markets, driven by our new distribution centres improving our customer proposition resulting in market share gains across Northern Europe.
“A period of investment into our proposition and infrastructure in H1 has increased our operational costs and restricted margins in the short term. Encouragingly, revenue growth over the last six weeks supports our expectation that, as previously stated, revenue and profitability is likely to be more H2 weighted in FY18 than in FY17.
“We remain focused on delivering long-term sustainable growth through investment in our people, products, websites and operational capabilities, and raising £4.2m growth capital in May 2017 has enabled us to start accelerating investment in these key areas.”
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