REG - Marks Electrical Grp - Trading Update

Marks ElectricalAnnouncement

11/10/2022 07:00

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RNS Number : 4005C  Marks Electrical Group plc  11 October 2022

Marks Electrical Group plc

Trading update for the six months ended 30 September 2022

Continued revenue momentum, leading to market share gains and robust cash flow
generation

 

Marks Electrical Group plc ("Marks Electrical" or "the Group"), a fast-growing
online electrical retailer, provides the following trading update for the six
months ended 30 September 2022 ("the period" or "HY23"), ahead of announcing
its Half Year Results on 8 November 2022.

          6 months ended 30 September
          HY23 (£m)   HY22 (£m)   YoY%
 Revenue  43.1        37.5        15.1%

 

Highlights

 * Strong trading period, with revenue growth of 15.1% to £43.1m (HY22 £37.5m),
sequentially improving against the 13.7% revenue growth in the first four
months of FY23 and against a particularly challenging market back-drop

 * Continued market share gains in the Major Domestic Appliance and Consumer
Electronics markets

 * Strong performance driven across all categories but particularly in
televisions, cookers, vacuums and small appliances

 * We retained our disciplined focus on profitable market share growth in the
first half against a backdrop of heightened levels of competitor discounting
and marketing. While this put pressure on H1 margins, we expect this to ease
over H2 given reduced competitor discounting in recent months, our rigorous
cost control and improved operating leverage during the peak trading period

 * Maintained industry leading Trustpilot score of 4.8, demonstrating our
commitment to operational delivery and customer satisfaction

 * Robust, debt-free balance sheet and disciplined working capital management -
maintained inventory levels, paid our maiden dividend, and achieved a closing
net cash position of £7.7m (FY22 £3.9m)

 

Mark Smithson, Chief Executive Officer, commented:

"After a solid performance in the first four months, the Group's positive
trading momentum has continued in August and September as we continued to
harness our market-leading customer service proposition and build brand
awareness, enabling the Group to deliver continued revenue growth and market
share gains.

The strong competitive activity we saw in pricing during the first quarter has
begun to ease more recently and despite the margin pressure this has had in
the first half, we remain focused on controlling our overhead base and
confident of achieving our full year targets.

Given the challenging economic backdrop our focus on maintaining inventory
whilst improving inventory days has been key, allowing us to close the period
with a net cash position of £7.7m. This puts us in a strong position for the
months ahead.

Our differentiated operating model, leading customer service and free next day
delivery provides a unique offering that sets us apart from the competition.
I'm proud of our achievements in the first half and thank all of our
colleagues for their focus on developing and maintaining our leading customer
proposition in a very challenging market.

As momentum continues to build going into the peak trading period, our focus
on operational excellence and cash flow generation, combined with our net cash
position, provides us with a robust platform to generate continued profitable
market share growth and achieve our full year targets."

 

Enquiries:

Marks Electrical Group
plc
Via Dentons Global Advisors:

Mark Smithson,
CEO
Tel: +44 (0)20 7664 5095

Josh Egan, CFO
 
 

Dentons Global Advisors (Financial PR)

Jonathon Brill / James Styles / Fern Duncan
                                                Tel:
+44 (0)20 7664 5095

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

Panmure Gordon (NOMAD and Joint Broker)

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

Erik Anderson (Corporate
Broking)

Berenberg (Joint Broker)

Matthew Armitt / Michelle Wilson / Richard Bootle (UK Investment Banking)
             Tel: +44 (0) 20 3207 7800

 

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 Group operates within
the UK Major Domestic Appliances (MDA) and Consumer Electronics (CE) market,
estimated to be worth approximately £8.0 billion.

Primarily through its simple, clear and intuitive website -
markselectrical.co.uk - the Group offers over 4,000 products from over 50
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. Marks Electrical delivers direct to
customers in its owned and branded vehicles, operated by the Group's skilled
team of delivery drivers, who are also able to offer installation and
recycling services.

For further information, visit the Marks Electrical corporate
website: https://group.markselectrical.co.uk
(https://group.markselectrical.co.uk/)  and its retail
website: https://markselectrical.co.uk/ (https://markselectrical.co.uk/) .

 

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