Catch reports $306 million in revenue in FY17
Catch Group has released its financial results for FY17, reporting $306 million in revenue and EBITDA of $16 million, making Catch the most profitable pureplay online retailer in the country.
The company owns and operates a portfolio of e-commerce sites including Catch (formerly Catch of the Day), Scoopon, Pumpkin Patch, GroceryRun, Mumgo and Bon Voyage.
The results exclude revenues from the newly launched Catch Marketplace, which, according to Catch Group, is growing by over 25 per cent week-on-week in terms of revenue.
“Looking at the graph, it’s like a hockey stick. Every day five to 10 new sellers join, bringing thousands of new products every week. Everything sells. It’s the long tail that’s really exciting,” Catch Group co-founder Gabby Leibovich told Internet Retailing.
Since Catch Marketplace launched, the company has signed up approximately 200 brands and added 25,000 new SKUs in several new categories, such as top-brand computers, outdoor equipment, musical instruments, furniture, sporting equipment and video games.
“The only thing holding us back is the IT and we’re working on that quickly. Some of the sellers coming on board have 100,000 SKUs, some have 300,000. Variety is king,” Leibovich said.
The company is currently in the process of onboarding over 300 suppliers and plans to add one million additional SKUs by Christmas 2017. Leibovich said he expects the marketplace to beat its sales target of $50 million for FY18 based on demand so far.
Catch Group also reported a growth in customer numbers, with close to one million active customers and almost 100,000 members of Club Catch, the group’s loyalty program for members.
Leibovich said he expects the marketplace to help drive customer acquisition going forward.
“Our marketplace is slowly being connected to SEM [search engine marketing], which allows us to grab a lot of customers who were searching for products who weren’t being sent to Catch before,” he said.
“Once a customer does discover a trampoline on marketplace, hopefully they’ll come back for what we specialise in.”
Leibovich said rapid expansion into new categories is a key focus for the year ahead, whether through entering into exclusive distribution agreements with up and coming brands, building out a new business, or acquisitions such as Pumpkin Patch.
The strategy could potentially result in a tug-of-war between Catch Group and another large Australian pureplay e-commerce company, Kogan.com, which recently announced revenues of $289.5 million and EBITDA of $13.2 million in its first full-year as a publicly-listed company.
Kogan.com founder and CEO Ruslan Kogan has also said he’s on the lookout for acquisitions, telling the AAP he expects a lot of online retailers that blew money on marketing and brand-building to fall over in the coming year.
“That creates an opportunity for Kogan.com,” he said.
For his part, Leibovich said he expects there will be “more than enough” acquisition opportunities to go around. “Some of those strugglers will suit Catch Group and some will not,” he said.
“If there’s a great acquisition on the horizon and it’s $10 million, we’re always ready to pounce on something.”
Leibovich said the company expects Pumpkin Patch to relaunch in October, but he declined to provide an update on the company’s first bricks-and-mortar store, which is due to open by year end.
As a privately held company, Catch Group was under no obligation to report its earnings to the public. Leibovich said they chose to do so to highlight the rapid growth of Catch Marketplace.
“We’ve always been very profitable. We’ve even made more money than this in previous years. The reason for this is to highlight the marketplace. It’s strong and going to give us a lot of eyeballs,” he said.
Nati Harpaz, CEO of Catch Group, is the chairman of Octomedia, Inside Retail’s parent company.