SHP’s quarterly sales revenue hits record – up 273%
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Shoply Limited (ASX:SHP) has recorded strong sales revenue for Q1 of the 2015 financial year with growth of 273% on last quarter’s results.
SHP is a pure play online retailer that’s amassed a stable of seven online retail businesses covering a wide range of products for sale in the Australian online retail market – a sector worth $15BN and rising.
Q1 results set sales record for SHP
SHP’s Quarterly Cash Flow report for Q1 of 2015 (ending 30th September) shows the company earned record sales compared to the last quarter, up 273% on Q4 of 2014, with $3.5M in revenue.
These positive results mark the fourth consecutive quarter of large scale growth for SHP and the company is predicting this run will continue into Q2 of 2015, with an expected sales boost from the upcoming Christmas retail period.
SHP’s cash receipts for the quarter were also up, rising 232% to a total of $3.6M compared to $1.1M in the previous quarter.
The company says the large increase in revenue and cash receipts can be largely attributed to sales from its new acquisitions; YourHomeDepot.com which specialises in high-end kitchenware, and Warcom.com, which sells IT and computer products.
The deals to acquire both companies cost a combined $3M and were completed in Q4 of 2014 – but each only contributed three weeks of sales to that quarter’s results.
SHP’s chief executive officer Simon Crean says the 273% increase in sales revenue shows how quickly the company is progressing as a pure play online retailer in the Australian market.
“We are pleased to say that our recent acquisitions are performing in line with our expectations and are allowing us to invest further in personnel and inventory and so that Shoply can continue on its growth trajectory.”
Christmas retail push for SHP’s online retailers
The Christmas retail period is a traditionally busy time for retailers, and SHP is preparing for an expected increase in demand by boosting its inventory by 20%.
The Australian National Retail Association predicted in 2013 that Australians would spend $30BN in the 2013 holidays and close to $2BN on Boxing Day alone. Similar predictions are expected for the 2014 period.
SHP says it has spent $600,000 to increase its stock for the Christmas period as well as hiring more staff and increasing its advertising spend. It has also cut $400,000 from its expenses by shifting to New South Wales the operations of its baby goods business Wow Baby, and toy and games retailer Toy Store.
CEO Crean says these moves along with the Christmas rush should ensure further growth for SHP this quarter. “The focus going forward will be to continue to be on growing revenues, whilst also investing in the business to achieve further scale. We look forward to providing shareholders an update following the Christmas period.”
SHP to launch mobile friendly websites in November
SHP has embarked on a redesign of YourHomeDepot.com’s web and mobile sites to make them even more mobile friendly – a process costing $100,000 so far.
The company says it decided to undertake the redesign work after it found 50% of the YourHomeDepot.com website’s customers make purchases from smart phones – so the interfaces need be more optimised for that platform to ensure strong sales.
The new look and function sites are expected to launch in November of 2014 – right in time for the Christmas sales period SHP anticipates will drive growth this quarter.
Organic growth strategy on course
SHP is also planning to launch two more online retailers – homeappliances.com.au and sportinggoods.com.au that will allow it to cover almost every category of online retail in Australia.
The company has $2.9M cash in the bank and says it remains committed to an aggressive growth plan, both through organic development to its business and opportune acquisitions of strong online retailers.
New finance chief for SHP
Overseeing SHP’s books will be Graeme Lay, who has been appointed SHP’s Chief Financial Officer.
Lay is a Certified Practising Accountant with an MBA from Deakin University; he has 26 years of professional experience in a variety of industries.
Next moves for SHP
SHP has achieved record growth for four consecutive quarters and the 273% uptick in revenue for Q1 of 2015 is a strong start to the financial year.
Consumer sentiment is rising in Australia and SHP anticipates further strong growth for its online retailers.
SHP says the upcoming Christmas period should drive strong sales and it has moved to increase its inventory, staffing and advertising to take the fullest advantage of this retail opportunity.
The expected November release of revamped YourHomeDepot web and mobile sites is expected to augment this strategy.
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