Kogan shares dip despite record half
20 January 2020, Written by Business News Australia
E-commerce giant Kogan (ASX: KGN) recorded its highest ever gross sales and gross profit in the first half of FY20, bolstered by record trading results on Black Friday and Boxing Day.
In a trading update today, the company noted gross sales were up 16 per cent for the half, while gross profit rose 9 per cent and active customer numbers were up 10 per cent at close to 1.7 million.
"The projects that we have rolled out in 2019 will pave the way for the business over the coming years these include Kogan Marketplace, Kogan First, Kogan Credit Cards and Kogan Energy," says Kogan.com founder and CEO Ruslan Kogan (pictured).
"We are investing into building strong customer relationships in these new divisions. We expect these divisions to delight our customers and drive loyalty over many years."
However, the trading update appears to be short of investor expectations with shares down 14.5 per cent at $6.79 at 11:55am AEDT.
The Kogan Marketplace, a platform launched in March that allows third parties to sell their products, saw its gross sales surge in the last three months of the year by 44 per cent quarter-on-quarter to just shy of $35 million.
"As we introduce new sellers to the Kogan Marketplace, and rapidly grow that division, we are undergoing a period of transition to an e-Commerce company that is no longer constrained by inventory and is capable of infinite growth without additional capital," says
"In the long term, this creates huge benefits to both our customers and our shareholders as we build one of the major e-Commerce marketplaces in Australia and New Zealand.
He adds the group is just at the beginning of seeing benefits from major investments in warehousing and infrastructure for faster delivery, as well as in Kogan Marketplace for greater variety and other developments.
"We're just getting started, and we look forward to delighting our customers with the benefits of these strategic investments for years to come."
The company also reported its cash balance stood at $34.1 million on 31 December, while its debt facility of $30 was undrawn.Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
Business News Australia
Author: Business News Australia