Kogan sales tumble, but founder says future looks brighter
Trans-Tasman online retailer Kogan says the business recorded “subdued” sales movement in its first quarter.
Based on unaudited management accounts, group sales across Kogan, Dick Smith and Matt Blatt divisions – and its New Zealand subsidiary Mighty Ape – fell 38.8 per cent to $203.3 million while the active customer base declined 12.3 per cent to 3,596,000 as at September 30.
Gross profit dropped 40.4 per cent to $31.3 million while adjusted EBITA was $300,000. Kogan First subscribers — which includes those in both Australia and New Zealand — grew by 5.1 per cent.
Ruslan Kogan, founder and CEO, said inflation and rising interest rates are putting pressure on households across Australia and New Zealand.
“We know that during periods of belt-tightening like this, our responsibility to be the best place for consumers to get a bargain on their key household items is more important than ever.
“While there is a lot of uncertainty in the world, we’re optimistic and excited to continue delighting our millions of customers and the growing base of loyal Kogan First subscribers.”
The company is currently “focused” on reducing excess inventory and operating costs while streamlining the business to return to the margins it enjoyed prior to the pandemic.
Kogan said the business “does not believe” the first-quarter results are “indicative of its projected trading performance” for the remainder of the year, expecting an improvement once the final sell-through of excess inventory is complete.