International growth, rising website traffic and improving conversion rates have been attributed to Gear4Music’s surge in revenues and profits.
According to its unaudited financial results for the six-month period ending August 31, overall revenue at the online musical instruments retailer shot up 44 per cent to £31.21 million.
Of this, its UK revenue jumped 30 per cent to £17.9 million while international revenue surged 70 per cent to £13.3 million.
Meanwhile, gross profit increased 36 per cent to £7.8 million.
However, £621,000 was shed from Gear4Music’s EBITDA year-on-year, dropping from £1.33 million to £717,000.
The retailer’s net profit in the half-year period also dropped, from the £750,000 recorded in the first half of last year to £4000 in the same period this year.
Nonetheless, Gear4Music said its active customers base has grown 44 per cent, with an email subscriber database of over 725,000.
The retailer said the results reflected planned investment in marketing and people, including new European distribution centres in Germany and Sweden – which incurred £700,000 in local administrative expenses.
Gear4Music also expects its trading to be in line to meet full year expectations, and has just launched a dedicated US website.
“I am very pleased with these results which combine tangible strategic and commercial progress with 44 per cent revenue growth, which was ahead of our expectation for [the first half] as indicated at the start of the year, equating to two-year growth of 150 per cent,” chief executive Andrew Wass said.
“Revenue growth in our core UK market continues to be strong, alongside a very strong performance in our international markets, supported by our new distribution centres that have improved our scale and customer proposition across Europe.
“We are pleased to announce today the launch of our US website, which represents an important stepping stone in our plans for growth outside Europe.
“We remain focused on delivering long-term sustainable growth, and raising £4.2 million growth capital in May 2017 has enabled us to accelerate planned investment in our operational infrastructure and allowed us to capitalise on the growth opportunities we have identified.”
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