Trading Update and New Third Party Arrangements
06 April 2022
FY22 ahead of market expectations. Revenue +138% yoy and every month EBITDA positive in H2.
Sosandar, the online women's fashion brand, is delighted to provide the following trading update for its financial year ended 31 March 2022.
Following its record performance in Q3 FY22, the Company delivered its second consecutive EBITDA positive quarter in Q4 FY22 with very strong trading across all channels. As a result of this successful trading period, the Board is pleased to announce that it now anticipates reporting revenue and EBITDA for the full year ended 31 March 2022 (“FY22”) ahead of recently upgraded market expectations*.
Highlights for the financial year ended 31 March 2022:
- The Company expects to report revenue in excess of £29.0m, up 138% year on year.
- EBITDA loss reduced by over 80% from a loss of £2.92m in FY21 (six consecutive EBITDA positive months in H2 FY22)
- Ever increasing engagement with loyal customer base through Sosandar.com:
- Number of orders increased 84% to 508,473
- Repeat orders increased 93% to 366,848
- Conversion rate increased to 3.9% from 3.1%
- Average order frequency increased by 10% to 2.28 times per annum
- Average order value of £90.39, up 9% from £82.70 in the prior year
- Gross margin rose to 56.0% (from 48.0% in the covid impacted prior year)
- Ongoing investment in inventory following the equity fundraise in May 2021 executed to plan
- Net cash in excess of £7.0m as at 31 March 2022 (FY21: £3.9m)
This record performance, across all metrics, is testament to the Company’s strategy, unique product offering and ever increasing brand awareness across its target market. The Company’s broad product range, with new styles available daily, and highly effective marketing continues to drive strong growth with both new and repeat customers.
The strategy to accelerate sales growth on Sosandar.com and through the Company’s concession partners has been executed to plan with a very strong sales response as a result of the Company’s dynamic design and product development process as well as the greater depth and breadth of stock made available across all product categories. Sosandar is successfully growing its scale and customer loyalty and has become a key strategic partner of its three major third-party retailers, M&S, Next & John Lewis, with significant opportunities for further growth.
The Company has increased inventory levels throughout the year to support the significant step up in demand across Sosandar’s own site as well as third party retail sites. Q3’s strong sales of the autumn/winter range, including partywear, has been followed by an earlier than normal take up of spring and holiday ranges in Q4.
The Company has continued to leverage its agility to navigate external headwinds, including global supply chain challenges which, alongside margin gains driven by the growth of the business, have resulted in no material impact to date. However, the Board continues to monitor the situation closely.
*Prior to the release of this announcement Sosandar believes that current market expectations:
(i) for the year ended 31 March 2022 are revenue of £27.1 million and an EBITDA loss of £0.9 million
(ii) for the year ending 31 March 2023 are revenue of £38.5 million and EBITDA of £1.7 million
(iii) for the year ending 31 March 2024 are revenue of £52.5 million EBITDA of £2.6 million.
New Third Party Arrangements
Following its successes with third party partnerships to date, the Company is delighted to announce it has extended its relationship with Next PLC, with Sosandar products to be sold through Next’s ‘Platform Plus’.
In addition, following an approach by The Very Group, Sosandar is pleased to have commenced a wholesale agreement from March 2022.
Next Platform Plus
‘Platform Plus’ allows Next customers to order items picked from Sosandar’s own warehouse, which are then delivered via Next’s distribution network. This agreement builds on the success of Sosandar’s existing relationship with Next, which has gone from strength to strength since it was established 18 months ago. Sosandar will launch its new activity with Next Platform Plus during Q1 FY23, allowing for an extended Sosandar product range made available to Next customers and accelerating Sosandar’s sales.
The Very Group
Sosandar commenced a wholesale agreement with The Very Group in March 2022 with strong sales and quick repeat orders being placed.
Selling Sosandar products through Very.co.uk will further increase the brand’s reach amongst its core target demographic and deliver incremental revenue and EBITDA.
Sosandar is hosting a Q&A call for analysts and investors today at 9.00am to discuss the Trading Update. If you would like to register for the call please follow this link: https://bit.ly/SOS_FY21_TU
Ali Hall and Julie Lavington, Co-CEOs commented:
“This has truly been a milestone year for Sosandar, and we are delighted with what the team has achieved over the past 12 months. We successfully executed our strategy across own site and third parties, building momentum in H2 and ultimately delivering our first six months of profitability which is a pivotal moment for us all. This outstanding performance means we now anticipate FY22 results to be ahead of current market expectations.
Our success is testament to what we have achieved as a business to date, further endorsing the strong and ever-growing appeal and quality of the Sosandar brand. We are also incredibly proud Sosandar is capturing the hearts of fashion-forward women and are delighted to add The Very Group to our family of partners. Despite the continuing uncertainty in the wider environment, our confidence in the outlook for Sosandar is undiminished and, reflecting our trading momentum, we plan to further accelerate our growth in the new financial year and beyond.”
|Julie Lavington / Ali Hall, Joint CEOs||c/o Alma PR|
|Steve Dilks, CFO|
|Singer Capital Markets|
Peter Steel / Tom Salvesen / Kailey Aliyar
|+44 (0) 20 7496 3000|
|Alma PR Limited (Financial PR)||+44 (0) 20 3405 0205|
|Rebecca Sanders-Hewett / Susie Hudson / Sam Modlin||[email protected]|
This announcement contains inside information for the purposes of the retained UK version of the EU Market Abuse Regulation (EU) 596/2014 ("UK MAR").
About Sosandar plc
Sosandar is one of the fastest growing women’s fashion brands in the UK targeting style conscious women who have graduated from price-led alternatives. The Company offers this underserved audience fashion-forward, affordable, quality clothing to make them feel sexy, feminine and chic. The business sells predominantly own-label exclusive product designed in-house.
Sosandar’s product range is diverse, providing its customers with an array of choice for all occasions across all women’s fashion categories. The company sells through Sosandar.com and has brand partnerships in place with Next, John Lewis, Marks & Spencer and The Very Group.
Sosandar's strategy is to continue growing brand awareness and expand its customer database whilst also further driving its high levels of customer retention. This is achieved through its exceptional products, seamless customer experience and impactful, lifestyle marketing activities all of which is underpinned by combining innovation with data analysis.
Sosandar was founded in 2016 and listed on AIM in 2017. More information is available at www.sosandar-ir.com