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Kogan Shares Up 9% After Record Christmas

E-commerce giant, Kogan.com, has achieved its strongest Christmas yet, with record Black Friday and Boxing Day trading offsetting declining iPhone sales. Shares have spiked over 9% to $3.55.

Founder and CEO, Ruslan Kogan, asserts over Christmas the company delivered “more items than ever, faster than ever”, driving record results.

“The investments we have made in a nationwide logistics footprint enabled us to delight customers all over Australia with rapid delivery, along with the great value they have come to expect from Kogan.com.”

For the period ending December 31, Kogan.com post a 32.2% year-on-year jump in active customer growth.

In an unaudited business update, the company claims active customers notched 1,542,000 – up from 1,166,000 the same time last year.

Over the half year, Kogan.com’s core divisions (Exclusive Brands, Partner Brands and Kogan Mobile) all delivered growth in revenue and active customers.

For 1HFY19, total revenue growth climbed 9.7% YoY.

The receipt of new inventory ranges leading up to Christmas saw Exclusive Brands revenue growth accelerate in the later part of 1HFY18 – overall growth during the half was 23.6%.

During the half year, Global Brands revenue slumped 46.7%, citing changes in GST law and the “apparent avoidance” of GST by several foreign websites selling into Australia.

Kogan.com claims Global Brands revenue was “significantly impacted” by subdued demand for new Apple products, particularly iPhones.

Excluding Apple, Global Brands product revenue jumped 8.5%. Brands include the likes of Samsung, Google, Garmin and Xiaomi.

By contrast, Partner Brands revenue growth soared 92.8% during the half-year, driven by the on-boarding of new brands and inventory investment.

Gross margin claims to have improved during 1HFY19, coming in broadly in line with 1HFY18.

Kogan.com’s marketing expenditure increased 25% during the half-year, however, it asserts ROI and efficiency have also improved.

Warehousing efficiency also claims to have jumped, with overall expenditure on variable costs growing by under 30% YoY during 1HFY19.

Considering subsidiary businesses, Mr Kogan asserts its “laid the foundation” for the expansion of Kogan Money into additional financial services verticals – e.g. strong partnerships with Mercer and Citibank.

The company has also launched Kogan Money Home Loans in collaboration with Adelaide Bank and Pepper.

For the period ending December 31, Kogan Mobile active customers soared 75% year-on-year.

Kogan.com affirms it’s also cooperating with the ACCC regarding its enquiry into a June 2018 marketing promotion. At this stage, the company states it has no further update.

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COMMENT: Where Is ‘Loud Mouth’ Kogan As Stock Plunges