REG - Marks Electrical Grp - Pre Close Trading Update

Marks ElectricalAnnouncement

11/04/2022 07:01

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RNS Number : 8701H  Marks Electrical Group plc  11 April 2022

Marks Electrical Group plc

Pre close trading update for the twelve months ended 31 March 2022

Record annual revenue with continued strong trading momentum

 

Marks Electrical Group plc ("Marks Electrical" or "the Group"), a fast-growing
online electrical retailer, today announces the following trading update for
its fourth quarter ended 31 March 2022 ("the period" or "Q4-22"), ahead of
announcing its Full Year Results for the 12 months ended 31 March 2022 on 7
June 2022.

 

          12 months ended 31 March         3 months ended 31 March

£m
£m
          FY22       FY21       YoY%       FY22      FY21      YoY%
 Revenue  80.5       56.0       44%        20.7      17.4      19%

 

Financial highlights

·      Record full year revenue with growth of 44% to £80.5m (2021:
£56.0m)

·      Operational leverage continued during the period, driving margin
expansion in the second half, with the Group expected to achieve its full year
Adjusted EBITDA margin target of 9.0% in line with market expectations

·      Strong trading period in Q4-22 with 19% revenue growth to £20.7m
(Q4-21 £17.4m)

·      Continued positive trading momentum in March 2022, with an exit
growth rate in the final month of over 25% year on year

·      Robust balance sheet, with closing net cash position of £3.9m

 

Operational highlights

·      Continued strong market share gains in the Major Domestic
Appliance and Television markets

·      Further focus on brand awareness initiatives driving sequential
improvement in organic and direct website traffic

·    Added further delivery vehicles during the period, increasing owned
fleet capacity and strengthening free next day delivery capability across the
UK

·      Further improvements made in warehouse efficiency, to maximise
facility utilisation

·      Maintained market-leading Trustpilot rating of 4.8

 

Mark Smithson, Chief Executive Officer, commented:

"The fourth quarter was another excellent trading period for us, with 19%
revenue growth vs. a particularly strong comparative of 127% in the prior
year. Our disciplined focus on margin management, capital allocation and cash
generation has also led to a strong returns profile from our asset light
operating model.

During the period we have continued to enhance our operational capacity and
have added additional resources in our customer services and
driver-installation teams, helping us to maintain our market-leading customer
service score of 4.8 on Trustpilot. Our USP of free next day delivery with our
own fleet of vehicles, combined with our capacity unconstrained single site
location, is helping us deliver operational excellence and gain market share
in a highly competitive market.

We continued our focus on improving brand awareness with our offline marketing
campaigns, coupled with our search engine optimisation improvements, driving
higher levels of organic and direct traffic.

With face to face meetings back on the agenda, we have met with multiple
suppliers during the period and discussed our expansion plans and ways in
which we can support each other's growth objectives. This, coupled with
inventory expansion in the second half, as supply constraints start to ease,
is making Marks Electrical a more prominent retailer for our brand partners.

I would like to take this opportunity to thank our colleagues and brand
partners for helping us achieve a record year, despite a challenging market
environment. We are well placed to seize the opportunities ahead thanks to our
compelling customer proposition, low-cost operating model and continued focus
on profitable market share growth, with more and more people from across the
UK coming into contact with the Marks brand for the first time. As we look
forward to FY23, our trading momentum has continued during the start of April,
setting us up well for our FY23 financial targets."

 

 

Enquiries:

Marks Electrical Group
plc                                                                             Via
Dentons Global Advisors:

Mark Smithson,
CEO                                                                                                        Tel:
+44 (0) 7510 385 554

Josh Egan, CFO
 
 

Dentons Global Advisors (Financial PR)

James Styles
                                                                                                           markselectrical@dentonsglobaladvisors.com
(mailto:markselectrical@dentonsglobaladvisors.com)

Fern Duncan
 
                     Tel: +44 (0) 7510 385 554

Panmure Gordon (NOMAD and Broker)

Oliver Cardigan, Ailsa Macmaster (Corporate
Finance)
Tel: +44 (0) 207 886 2500

Erik Anderson (Corporate
Broking)

 

About Marks Electrical

Marks Electrical is a fast growing, highly scalable, technology driven
e-commerce electricals retailer which sells, delivers, installs and recycles a
wide range of household electrical products. The Group was founded in
Leicester in 1987 by Mark Smithson and has scaled up into a nationwide online
retailer with a compelling growth track record, thanks to its vertically
integrated, low-cost, high-quality operating model, supported by the ongoing
structural shift of consumers to purchase online. The Company operates within
the UK Major Domestic Appliances (MDA) market, estimated to be worth
approximately £5.3 billion.

 

Primarily through its simple, clear and intuitive website -
markselectrical.co.uk - the Company offers over 3,000 products from over fifty
leading brands across its main product categories, which include Cooking,
Refrigeration, Washers & Dryers, Dishwashers and Audio-Visual. These
products are sourced from UK distributors of the brands, with whom the Group
maintains strong and direct relationships. Delivery to customers is operated
by its own skilled team of delivery drivers in its owned and branded vehicles,
who are also able to offer installation and recycling services.

 

For further information, visit: https://group.markselectrical.co.uk
(https://group.markselectrical.co.uk) and https://markselectrical.co.uk/
(https://markselectrical.co.uk/) .

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