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Print-on-demand fashion and art marketplace Redbubble (ASX: RBL) has seen its niche offering ride the rise of e-commerce during FY20, with earnings up by 358 per cent during the period to $5.1 million.
The company says its FY20 financial result reflects a positive shift to online retail, which saw its marketplace recording revenue of $349 million, up 36 per cent.
However, despite the company's ability to tap into e-commerce bonanza, the group still reported a loss of $8.8 million, which was down from a $27.6 million loss in FY19.
"RB Group's on-demand fulfilment model and differentiated consumer offerings provide us with distinctive advantages," says Redbubble CEO Martin Hosking (pictured).
"The strong financial performance follows from these fundamentals. It has been pleasing to see the acceleration of existing trends in the last few months.
"2021 represents a year of opportunity for the business. We are positioned to build on a decade of momentum and aggressively pursue the global opportunity presented by the shift to online activity and increasing adoption of e-commerce platforms."
Redbubbles' revenue growth was particularly strong during the fourth quarter when COVID-19 lockdowns and restrictions were implemented by governments worldwide.
COVID-19 initially resulted in sales volatility and a reduction of demand for Redbubble's goods, however, after this initial decline, the group benefitted from an acceleration in online activity.
Gross profits of $134.9 million strengthened over the course of FY20 following the onboarding of additional fulfilment capacity in Europe, Canada and the United States.
The financial year was also the first full year of TeePublic's inclusion in the group's results following Redbubble's acquisition of the t-shirt marketplace in October 2018.
Because Teepublic operates in a similar economic environment to Redbubble's main marketplace the revenue results for the two were bundled. Together, they generated $416 million in revenue for the umbrella company.
During the year there were 551,000 selling artists on the Redbubble platform, up 51 per cent, and artist earnings were $67 million, up 35 per cent.
The company now has 6.8 million unique customers, with repeat consumers accounting for 40 per cent of marketplace revenue.
Redbubble says the new financial year has started strongly, with July marketplace revenue growth more than doubling in July, and similar sales levels in the first two weeks of August.
The company has not paid and does not propose to pay dividends for the year ended 30 June 2020.
At the year end, Redbubble retained a cash balance of $58 million - an increase of $29 million.
Shares in Redbubble are up 0.28 per cent to $3.56 per share at 11:15am AEST.
Updated at 11:51am AEST on 21 August 2020.
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