Marks Electrical Group plc
Pre close trading update for the twelve months ended 31 March 2024
Marks Electrical Group plc ("Marks Electrical" or "the Group"), a fast-growing online electrical retailer, provides a trading update for its fourth quarter ended 31 March 2024 ("the period" or "Q4-24"), ahead of announcing its Full Year Results for the 12 months ended 31 March 2024 on 27 June 2024.
| | 12 months ended 31 March | 3 months ended 31 March | ||||
|
| FY24 | FY23 | YoY% | FY24 | FY23 | YoY% |
| Revenue | 114.3 | 97.8 | 16.9% | 25.3 | 24.8 | 2.0% |
Highlights
· Record full year revenue of £114.3m (FY23: £97.8m) representing a growth rate of 16.9%, and more than double the revenue we achieved in the year prior to listing (FY21: £56.0m).
· Increased market share in the Major Domestic Appliances and Consumer Electronics markets.
· Gross product margin was maintained in the second half as expected, and the Group has achieved an adjusted EBITDA of approximately £5.0m.
· Further improvements in working capital and inventory turn during the year helped the Group achieve a closing net cash position of £7.8m, taking into account strategic investments in vehicles, equipment, facilities and systems.
· Improved industry-leading Trustpilot rating from 4.8 to 4.9, demonstrating the strength of our best-in-class customer proposition.
· As Marks Electrical continues to build its national presence and scale, we have made the strategic decision during the period to leave the Euronics buying group as at 31 March 2024. This will enable the Group to establish closer, direct relationships with its manufacturer partners, which will provide further opportunity to drive growth and margin in the future, and is the next natural step in our growth ambitions.
Mark Smithson, Chief Executive Officer, commented:
"I am proud of the revenue growth we have achieved of 16.9%, in a flat Major Domestic Appliances and a declining Consumer Electronics market. In addition, the investments we have made in driver training and customer services have resulted in us improving our Trustpilot rating from 4.8 to 4.9, further demonstrating the strength and attractiveness of our market-leading customer offering and the hard-work all of our colleagues throughout FY24.
As we focus on positioning our business to deliver long-term growth and value creation, our decision to exit the Euronics buying group represents the next logical step in that journey, further building on the direct relationships we have with our brand partners. We anticipate that our departure will lead to revenue and margin upside in the medium-term and in addition, once the exit has concluded, our £1.7m balance sheet investment crystallises into cash, expected in June 2024.
As explained in our January trading update, in the current trading environment consumers remain highly price-conscious, which given our premium focus, continues to have an adverse impact on our average order value, resulting in customer order volumes growing faster than revenue. This impact will limit our ability for margin expansion in the short-term, when taking into account the relatively fixed cost of delivery.
Despite this, we are very pleased with the growth in our order volumes and new customer acquisitions during the period and the strong growth we have seen in early April, giving us confidence that our fundamental strategy of continued profitable market share gains and excellent customer service will help us in delivering further growth."
Enquiries:
Marks Electrical Group plc Via Dentons Global Advisors:
Mark Smithson, CEO Tel: +44 (0)20 7664 5095
Josh Egan, CFO
Dentons Global Advisors (Financial PR)
Jonathan Brill / James Styles / Nishad Sanzagiri Tel: +44 (0)20 7664 5095
markselectrical@dentonsglobaladvisors.com
Canaccord Genuity (NOMAD and Broker)
Max Hartley / George Grainger (NOMAD) / Kit Stephenson (Sales) Tel: +44 (0) 207 886 2500
About Marks Electrical
Marks Electrical is a fast growing, highly scalable premium electrical retailer which sells, delivers, installs and recycles a wide range of household electrical products. The Group was founded in Leicester in 1987 by Mark Smithson and has scaled into a nationwide online retailer with a compelling growth track record, thanks to its vertically integrated, low-cost, high-quality operating model, supported by the ongoing structural shift of consumers to purchase online. The Group operates within the UK Major Domestic Appliances (MDA) and Consumer Electronics (CE) market, estimated to be worth approximately £7 billion.
Primarily through its simple, clear and intuitive website - markselectrical.co.uk - the Group offers over 4,500 products from over 50 leading brands across its main product categories, which include Cooking, Refrigeration, Washers & Dryers, Dishwashers and Audio-Visual. These products are sourced from UK distributors of the brands, with whom the Group maintains strong and direct relationships. Marks Electrical delivers direct to customers in its owned and branded vehicles, operated by the Group's skilled team of delivery drivers, who are also able to offer installation and recycling services.
For further information, visit the Marks Electrical corporate website: https://group.markselectrical.co.uk and its retail website: https://markselectrical.co.uk/.
The information contained within this announcement is deemed by the Company to constitute inside information pursuant to Article 7 of EU Regulation 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.
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