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Kogan Profit Up 22%, House Brand Sales Soar

Kogan.com has reported a 21.9% lift in net profit to $17.2 million, with house brand revenue soaring 41.6% year-on-year despite sluggish Australian retail conditions.

The company has also surpassed half a billion in gross sales, with double digit earnings growth.

For the full-year ending June 30, gross sales climbed 12% year-on-year to $551.8 million, with revenue up 6.4% to $438.7 million.

Gross profit jumped 12.5% YoY to $90.7 million, with EBITDA jumping 15.6% YoY to $30.1 million.

Active customers increased 15.9% from June 30 2018 to 1,609,000.

Kogan.com has announced a full franked final dividend of 8.2 cents per share, up 10% versus the prior year for a total FY19 total dividend of 14.3 cents per share.

As at June 30 2019, cash equalled $27.5 million, with an undrawn bank debt facility of $30 million, and inventories of $75.9 million ($8.4 million inventory in transit and $67.5 million in warehouses).

Kogan.com claims more than 99% of warehouse inventory at June 30 2019 was less than 365 days old.

“Financial year 2020 has started well, with July unaudited management results showing continuing strong business growth and acceleration in Kogan Marketplace,” claims Founder and CEO, Ruslan Kogan.

“In the 2019 financial year we have continued our significant investments in our improved customer offering.”

The company claims it now has 13 distribution centres, with “faster and more cost efficient” delivery options, alongside a significantly expanded product range.

Exclusive brands (i.e. house brands) revenue growth soared a whopping 41.6% year-on-year, with the segment now representing 49.7% of overall gross profit in FY19.

Third-party brands notched a year-on-year revenue decrease, following changing GST laws.

Apple sales also fared an on-year decline, following “subdued demand” in particular new iPhones.

The newly launched Kogan Marketplace is positioned as a “transformational step”, with the company using it to reduce reliance on third-party brand inventory and be more “capital light.”

Kogan Mobile grew its customers by a notable 24.4% during FY19, with Kogan Internet notching a 273.2% customer increase.

Unaudited management accounts reveal gross sales growth of 18.3% for 1HFY20, with gross profit growth of 32% and Kogan Marketplace Gross Sales of $7.1 million.

Shares in Kogan.com spiked over 5% to $5.51 shortly after market open – notably below highs of over $10 in past years.

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