13th Nov 2015 08:04
LONDON (Alliance News) - Stanley Gibbons Group PLC Friday reported a drop in profit in the first half of its financial year as it failed to meet the high margin sales it benefited from the year before, but said things should pick up in the second half.
The rare stamp and collectibles retailer said pretax profit in the six months ended September 30 fell to GBP0.4 million from GBP3.7 million in the same period the year before, as revenue stayed flat at GBP27 million and gross margin fell to 48.5% from 60.4%.
The company warned last month that profit and gross margin would be substantially lower in the first half as the comparative period the prior year benefited from high margin sales and material sold from exceptional purchases of major collections. It confirmed that this was the case on Friday.
Online revenue, however, rose by a quarter to GBP6.3 million, driven by growth in online auction bidding benefiting from its new and improved web auction platform.
Revenue and profit should be materially higher in the second half assisted by this year's auction calendar being more heavily weighted towards the latter part of the year, Stanley Gibbons said.
It added that it continues to work on a number of initiatives with the aim of delivering substantial sales from its stockholding of rare collectibles, particularly philatelic, and that it will benefit from a reduced fixed cost base and better cross-selling across the customer base in the second half following recent acquisitions.
Stanley Gibbons will not pay an interim dividend but said it will review dividend payments for the final dividend in respect of the full year based on current and expected trading performance and liquidity requirements.
"The resumption of trading performance to conform with the board's earlier expectations is management's top priority," Chairman Martin Bralsford said in a statement.
"The group continues to implement its strategy to evolve and diversify its activities, including an effective online and auction business model with more predictable revenue streams and profits," he added.
By Karolina Kaminska; [email protected] @KarolinaAllNews
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
SGI.L