The Hut Group returns to profit

Online retailer The Hut Group has today reported positive pre-tax profit of £300,000 for its full year after a £12.7 million loss a year earlier.

In the year ended December 31st 2012, group operating leverage delivered a strong profit-before-ta level after the e-tailer successful moved into new categories.

EBITDA rose 130 per cent year-on-year while total sales reached £145.3 million, representing an increase of 30.4 per cent year-on-year.

During the year, the group built a new data warehouse as part of a data driven strategy and exited white label operations while it also launched a single page checkout to simplify the basket checkout process, all of which helped drive growth.

A new mobile platform was also launched over the period to improve the website‘s performance and an internal gateway was integrated with international payment options as The Hut continued to seeks ways to support overseas expansion.

International sales represented 36 per cent of total sales and The Hut Group CEO Matthew Moulding believes the e-tailer is well-positioned to grow further.

“I am pleased to report another strong set of trading results for the Group,” he commented.

“The growth in both our own branded products, as well as our rapid expansion overseas, is presenting the Group with some significant opportunities in our principal operating categories of Lifestyle and Health and Beauty.

“Our substantial and recurring investment in the Group‘s proprietary operating platform is fundamental to increasing operating leverage which the Group is realising as we build scale.

“The platform has been a key factor in delivering the trading growth in 2012 which continues in 2013.

“Continuous investment in our data platform generates ever deeper trading insight into our customers and is a key component in ensuring the Group generates low cost, highly relevant visitors to our websites.”

Moulding also thanked former Chairman Angus Munro, who stepped down from his role over the year following three years with the e-tailer, for his “significant contribution” to growth during his tenure.

Munro was succeeded by Richard Pennycook, former Finance chief at supermarket Morrisons who was recently annoumced as incoming Group Finance Director at the Co-operative Group.

Commenting on the successes of the e-tailer, Pennycook said: “2012 has been a particularly pleasing year for the Group, delivering some excellent financial results during a period of sustained high growth.

“The Group‘s model is showing itself to be both scalable and disruptive, with international markets a particular opportunity.

“The Group remains well placed to continue its high growth across its core Lifestyle and Health and Beauty markets, especially as the channel shift towards online sales continues.”


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