TIDMSOS
RNS Number : 2425R
Sosandar PLC
28 October 2019
Date: 28 October 2019
On behalf of: Sosandar plc ('Sosandar' or 'the Company')
Embargoed until: 0700hrs
Sosandar plc
Half Year Trading Update
Investment in marketing, product and team delivers accelerated
growth
Sosandar PLC (AIM: SOS), the online women's fashion brand, is
pleased to announce the following trading update covering the six
month period ended 30 September 2019.
The Company expects to report revenue of GBP2.82 million for the
period, a 53% increase against the same period in the prior year,
reflecting progress made during the year so far, with Q2 up 84% and
September up 112% against the same periods in the prior year. The
Company is very pleased to report that October is already the first
month that its net revenues (post returns) have surpassed GBP1
million. As previously reported, the Company made the strategic
decision in Q1 to hold back customer acquisition funds to invest in
future months, whilst also investing into product teams to help
drive performance from Autumn/Winter 2019 onwards.
Acquisition funds have now been successfully deployed and this,
combined with the up-front investment in team and product, have
resulted in substantially higher growth in the important Autumn
period. Record monthly revenues were delivered in September, which
has been surpassed by October which is tracking over 100% up on the
prior year and 44% up on this September.
July's oversubscribed placing has supported the Company's
accelerated growth as planned. The Company has begun carefully
using the proceeds to strengthen its design capability, widen the
product range and to trial additional marketing channels. Sales
during the period have been strong across all product categories,
and especially in the new product areas such as denim. Average
order value has shown a marginal decrease due to average unit price
shifting slightly with the broadening of the product offering,
selling proportionately more denim and jersey. Units per basket has
increased year on year. Entering Q3, the Company expects to
continue with strong full price sales performance and expects some
increase in AOV as the cold weather drives sales of higher price
point items such as leather and outerwear.
As announced at the Company's AGM, in September the Company
began to use TV advertising and started to trial the use of
out-of-home digital media for the first time. This has included
testing in different TV regions, channels and programmes with
re-investment into those showing the best engagement versus cost
ratio and a test with digital panels across escalators at key
London train and Tube stations. These new marketing initiatives are
significantly increasing brand recognition and awareness.
September, the first month TV went live, saw a record number of
email subscriber sign-ups with a 224% increase on August and the
equivalent to approximately six months' performance in the prior
year.
Given the strong current trading and the very positive results
achieved so far, the Board has taken the strategic decision to
accelerate the growth of the business by investing further in TV
advertising. Accordingly, marketing expenditure for the current
financial year is expected to be higher than previously planned.
This increased expenditure is expected to significantly enhance
future growth through accelerated customer database growth and
increasing frequency of purchase from a loyal and highly engaged
following.
The investment that has been made into the product team across
all areas, including design, buying, merchandising and garment
technology, has resulted in the product range, as measured by
number of intake styles, more than doubling year-on-year. This
widening of the range has come through the additions of more choice
within product types, and new categories such as denim and
accessories. The new product range is resonating well with both
customers and celebrities, with household names such as Mel B and
Amanda Holden recently seen supporting the brand.
Over the period, customers have begun to place repeat orders
more frequently, whilst the returns rate has reduced to 49%, from
52% in the prior year. This demonstrates the appeal of the
Company's unique design aesthetic and customers' growing loyalty to
the Sosandar brand.
The Company will announce its interim results on 27 November
2019.
KPIs
6 months ended 30 6 months ended Change
September 2019 30 September
2018
Sessions 2,287,647 1,599,709 43%
Conversion rate 2.83% 2.75% 8bps
Number of orders 64,709 43,979 47%
Average Order
Value GBP97.55 GBP105.42 -7%
Returns 49% 52% 300bps
Customer database 148,884 84,500 76%
Active Customer
Base 75,056 44,096 70%
Repeat Order
Rate 1.66 1.53 8%
Ali Hall and Julie Lavington, Joint CEOs, commented:
"Our ability as an online retailer to employ an agile strategy
resulted in us focusing our customer acquisition activity on the
important Autumn months towards the end of the period and carrying
into current trading. As expected, the accelerated investment into
marketing and product is producing strong results with record
months in September and October.
We are seeing strong engagement from our ever-expanding base of
loyal existing customers and this will continue to increase as our
product range grows further. We are delighted with the success of
our new advertising activity and the Board is confident that
accelerating our future growth by increased investment in marketing
(especially via TV) in this financial year is the right decision
for our business.
With a widened product range offering, strong balance sheet, and
a broadened, aggressive, and increasingly effective marketing
strategy, we are confident about the full year."
Enquiries
Sosandar plc www.sosandar.com
Julie Lavington / Ali Hall, Joint c/o Alma PR
CEOs
Shore Capital
Patrick Castle / Mark Percy / James
Thomas +44 (0) 20 7408 4090
Alma PR Limited (Financial PR) +44 (0) 203 405 0205
Rebecca Sanders-Hewett / Susie Hudson sosandar@almapr.co.uk
/ Sam Modlin
About Sosandar PLC
Sosandar is an online womenswear brand, specifically targeted at
a generation of women who have graduated from throwaway fashion and
are looking for quality, affordable clothing with a premium,
trend-led aesthetic. This is a section of the market that is
currently being underserved.
Sosandar was launched in September 2016. The Sosandar business
model is built around using trend-led, exclusive designs produced
in-house and then manufactured using a variety of global suppliers.
Sosandar caters for a growing market of fashion-conscious women,
while utilising an outsourced logistics provider that can support
its planned growth over the coming years.
Sosandar's founders are Ali Hall and Julie Lavington, who
previously launched and ran high street fashion magazine Look, as
editor and publishing director respectively. They have a combined
experience of over 35 years in the fashion industry, including in
the design, manufacture and sale of fashion ranges for some of the
UK's high street retailers, including Debenhams, Office, Oasis and
JD Williams.
More information is available at www.sosandar-ir.com
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END
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