Kogan shares rise after gross sales race past $500m
20 August 2019, Written by Business News Australia
E-tail giant Kogan (ASX: KGN) expanded its product offering into uncharted territory in FY19 and delivered double digit earnings growth as a result.
The company's shares have risen by more than 8% today after the group reported it had surpassed half a billion dollars in gross sales for the year.
Revenue was up 6.4 per cent on FY18 to $438.7 million, while the company's gross profits also increased by 12.5 per cent to $90.7 million.
These strong results come as Kogan continues to diversify what it sells with a serious intention to dominate a range of industries in the online space.
Long gone are the days of Kogan being a tech-only retailer; the group is now an automotive sales platform, a credit card provider, a superannuation business, a telco, and an energy service provider.
One of the group's major additions to its suite of products during FY19 was Kogan Marketplace; a direct answer to Amazon's entry into Australia.
The Marketplace positions Kogan beyond a wholesaler and more as a platform; a place to buy or sell anything you could imagine.
Kogan founder and CEO Ruslan Kogan says the FY19 results are a testament to the company's agility willingness to expand.
"In the 2019 financial year, we have continued our significant investments in our improved customer offering. We now have 13 distribution centres, enabling us to delight customers all over Australia and New Zealand with faster and more cost-efficient delivery options," says Kogan.
"We have also significantly expanded our product range, giving our customers more choice and driving more competition on our platform."
"We now operate in more segments than ever with a very compelling offer in each segment. We have continued to invest in our brand and customer experience to drive our growing portfolio of businesses and improve our customer value proposition."
At the end of the financial year the company had more than 1.6 million active customers using the site.
These users are tapping into Kogan's variety of offerings and appear to be taking up Kogan's Marketplace product. The Marketplace has achieved $1.5 million in commission-based revenues since launching in FY19.
The first half of FY20 appears to be kicking off strong with gross sales growth of 18.3 per cent and gross profit growth of 32 per cent so far.
Business News Australia
Author: Business News Australia