REG - Gear4music - Trading Update

Gear4music (HOLDINGS)Announcement

02/04/2025 07:04

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250402:nRSB2395Da&default-theme=true

RNS Number : 2395D  Gear4music (Holdings) PLC  02 April 2025

2 April 2025

 

Gear4music (Holdings) plc

 

Year-End Trading Update

Gear4music (Holdings) plc ("Gear4music" or "the Group"), the largest UK based
online retailer of musical instruments and music equipment, today announces a
year-end trading update covering the 12 months to 31 March 2025.

 £m                                    12m to 31 Mar 2025  12m to 31 Mar 2024  % Change on FY24
 UK sales                              90.2                83.1                +9%
 European and Rest of the World sales  56.5                61.3                -8%
 Total sales                           146.7               144.4               +2%

 

FY25 Highlights*

·     Robust revenue growth in the UK, with European revenues reflecting
competitive pressures throughout the year in certain markets within the region

·     Gross margin expected to be 27.1% (FY24: 27.3%; FY23: 25.7%)

·     EBITDA expected to be £10.0m (FY24: £9.4m; FY23: £7.4m)

·     PBT expected to be £1.6m (FY24: £0.6m; FY23: -£0.4m)

·     Net bank debt further reduced to £6.4m at 31 March 2025 (31 March
2024: £7.3m; 31 March 2023: £14.5m)

* Prior to this update Gear4music believes that consensus market expectations
for the year ending 31 March 2025 were revenues of £154.7 million, EBITDA of
£11.7 million and profit before tax of £2.8 million.

Gear4music's Executive Chair, Andrew Wass, said:

 

"Despite a challenging consumer environment over the past 12 months, we are
pleased to report that the Group's financial performance in FY25 is expected
to surpass FY24. Our performance reflects higher revenues, stable gross
margins and a continued focus on cost control resulting in increased reported
EBITDA, and a £1.0m improvement in Profit Before Tax for the year. A further
reduction in net bank debt translates into leverage of x0.6 times FY25 EBITDA
(FY24: x0.8 times).

Financial performance in February and early March 2025 was subdued, primarily
due to aggressive discounting from underperforming competitors in both the UK
and Europe coupled with ongoing weak consumer confidence. However, both UK and
European like-for-like (LFL) sales improved markedly in the latter half of
March, with early indications suggesting that the competitive pressures may be
easing as a result of a number of significant retailers experiencing trading
difficulties and now exiting the market.

Through FY25, we have laid robust foundations for our revised growth strategy
first announced in June 2024, by investing in new own-brand products,
expanding our second-hand offerings, strengthening our marketing capabilities,
and enhancing our bespoke e-commerce platform. Economic uncertainty remains as
we enter the new financial year, nevertheless we believe these strategic
initiatives coupled with competitor developments in our market, position us
well to maintain our recent positive momentum and drive accelerated commercial
and financial performance in FY26 and beyond."

- Ends -

Enquiries:

 Gear4music                                             +44 (0)20 3405 0205

 Andrew Wass, Executive Chair

 Gareth Bevan, Chief Executive Officer

 Chris Scott, Chief Financial Officer

 Singer Capital Markets - Nominated Adviser and Broker  +44 (0)20 7496 3000

 Peter Steel/Sam Butcher, Corporate Finance

 Tom Salvesen, Corporate Broking

 Alma - Financial PR                                    +44 (0)20 3405 0205

 Rebecca Sanders-Hewett                                 Gear4music@almastrategic.com

 Joe Pederzolli

 David Ison

 

About Gear4music (Holdings) plc

Operating from a Head Office in York, Distribution Centres in York, Bacup,
Sweden, Germany, Ireland & Spain, and showrooms in York, Bacup, Sweden
& Germany, the Group sells own-brand musical instruments and music
equipment alongside premium third-party brands including Yamaha, Roland and
Roland, to customers ranging from beginners to musical enthusiasts and
professionals, in the UK, Europe and 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
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"). Upon the
publication of this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public domain.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTFLFFTSIILIIE