Sales soar at e-commerce group, Temple & Webster
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
Temple & Webster (ASX:TPW), Australia’s largest e‐commerce company in the furniture and homewares market, has provided a promising update on the impact of the COVID-19 virus on its business.
This included commentary on trading conditions as well as the group’s financial position and long-term strategy, all of which appear sound.
Temple & Webster has over 180,000 products on sale from hundreds of suppliers.
The business runs an innovative drop-shipping model, whereby products are sent directly to customers by suppliers thereby enabling faster delivery times and reducing the need to hold inventory, thereby allowing a larger product range.
A feature of the update was the group’s sales figures for the second half of fiscal 2020 which have been boosted by a particularly strong performance in April.
Second half revenue is up 74% on a year-on-year basis.
To put this in perspective, year-on-year revenues in the first half of fiscal 2020 were up 50%.
At a time when flattening the curve is making headlines across the globe, Temple and Webster’s curve is showing no signs of flattening in what is a healthy sign.
Zero debt and $20 million in cash
Management has not had to deal with the challenges that many retailers are facing as 95% of the company’s workforce, both onshore and offshore, have been working from home since the beginning of March.
Chief executive and co-founder Mark Coulter also noted that the company has been working closely with its partners, especially on the logistics front, to ensure the health and safety of their staff and the group’s customers by implementing procedures at the point of delivery to minimise the risk of infection.
From a financial perspective, Temple & Webster is in a robust position, being profitable and cash flow positive with a capital light business model.
E-commerce companies can scale up or down in line with business activity, as well as operating off a low fixed cost base.
Consequently, the company appears to be a relatively safe haven in the retail space, enhanced by its strong balance sheet which features zero debt and cash of $20 million.
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
