19th Nov 2024 11:37
(Alliance News) - Gear4Music Holdings PLC on Tuesday reported a 1.4% fall in revenue in the six months to the end of September caused by declining sales outside the UK, despite a return to revenue growth in the second quarter.
York, England-based Gear4Music is the largest online retailer of music equipment in the UK, and delivers to 190 countries.
Pretax loss narrowed by GBP700,000 to GBP1.2 million.
Total revenues fell by 1.4% to GBP61.7 million from GBP62.6 million. There was 6% year-on-year growth in UK revenues but a 12% decline in Europe and the rest of the world due to a "challenging consumer environment".
Gross margin fell from 27.1% to 26.7%, which the company said was impacted by "challenges with the implementation of a new outsourced AI-based marketing system" which are now resolved.
Reported earnings before interest, tax, depreciation and amortisation improved by GBP500,000 with a GBP1.0 million reduction in admin expenses.
The company also reported 5% revenue growth during the second half to date. It said the full-year outlook remains in-line with consensus market expectations which it believes are revenues of GBP154.7 million and pretax profit of GBP2.8 million.
Executive Chair Andrew Wass said: "We are pleased to report progress in executing our refreshed growth strategy announced in June 2024, resulting in improvements in our financial performance during FY25 H1.
"Our long-term focus remains on growing higher-margin revenues, and we will continue to invest in areas that support this objective, such as the Studiospares acquisition announced on 22 October 2024, our second-hand platform, and our own-brand product offering, teams and infrastructure. Our full-year outlook remains in-line with consensus market expectations, we are well prepared for our seasonal peak trading period," he said.
Shares in Gear4music were down 3.2% to 150.00 pence per share in London on Tuesday morning.
By Michael Hennessey, Alliance News reporter
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