Half Year Trading Update

22 October 2020

Gear4music (Holdings) plc

Half Year Trading Update

Gear4music (Holdings) plc ("Gear4music" or "the Group"), the largest UK based online retailer of musical instruments and music equipment, today announces a trading update for the six months to 30 September 2020.

Highlights

· Total sales growth of 42% to £70.2m (FY20 H1: £49.4m)

· Gross margin improved by 330bps to 28.5% (FY20 H1: 25.2%; FY19 H1: 22.7%)

· Gross profit increased by 60% from £12.5m in FY20 H1, to £20.0m

· Strong trading momentum has continued into October ahead of our traditional Christmas peak season

Gear4music's Chief Executive Officer, Andrew Wass, said:

"I am pleased to report that following an exceptional trading period in Q1 FY21, these strong trading patterns have continued throughout Q2 resulting in revenue growth of 42% for the first half. Our customers are continuing to appreciate the benefits that playing and creating music can bring during these difficult times, as well as the continued convenience of ordering our products online.

Building on the significant progress made during FY20, our focus on gross margin improvement, proportionally lower marketing spend and tightly controlled overhead costs is delivering tangible results. Alongside the exceptional period of sales growth during Q1, the outcome will be financial results for H1 FY21 that are materially ahead of last year.

Strong growth in sales and gross profits has continued during October, and preparations for what we expect to be a busy peak trading period are well advanced.

We are mindful of the uncertainties posed by Brexit and COVID-19, but are confident in the actions we are taking and the ability and commitment of our amazing staff, to ensure that the business is well positioned to overcome any potential short-term challenges. As such, the Board is confident that results for the full financial year will be ahead of previous consensus market expectations."

The Group will report Interim results for the six months ending 30 September 2020 on 17 November 2020.

- Ends -

Enquiries:

About Gear4music.com

Operating from a Head Office in York, and Distribution Centres and showrooms in York, Sweden and Germany, the Group sells own-brand musical instruments and music equipment alongside premium third-party brands including Fender, Yamaha and Roland, to customers ranging from beginners to musical enthusiasts and professionals, in the UK, Europe and, more recently, into the Rest of the World.

Having developed its own e-commerce platform, with multilingual, multicurrency websites delivering to over 190 countries, the Group continues to build its overseas presence.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.