Fishing tackle and equipment retailer Angling Direct (ANG:AIM) grew first half sales by 19.5% in the face of Covid restrictions and tough comparatives. The company also said it is ‘well positioned to leverage the growing interest in fishing’ helping to nudge the shares 2.4% higher to 73.75p on Wednesday.
Strong performance in the first half means full year EBITDA is expected to be ‘not less than £4 million’, prompting Singer Capital Markets to upgrade its earnings per share estimate by 8% or £200,000 while highlighting upside risk to its estimates.
For the six months ended 31 July 2021, group revenue grew 19.5% to £38.4 million and retail store sales increased by 40.1%, despite the shuttering of all Angling Direct’s brick and mortar outlets for over 10 weeks under the third Covid-19 lockdown.
Sales shot up by 54% in the first quarter, though the growth rate slowed to 3.5% in the second quarter as Angling Direct lapped ‘unprecedented levels of demand in the prior year following store re-openings on 15 June 2020’.
BREXIT HIT ABATES
Online sales edged 3.2% higher to £18.4 million in the half against a very strong comparable period, in particular the final two months of the half to July 2020.
UK online sales grew by 15.8%, although sales across Angling Direct’s German, French and Dutch native language websites fell 34.2% due to Brexit-led bait restrictions and border disruption.
Thankfully, sales in Europe speak for less than 5% of group revenue and have started to improve in recent months.
Three weeks into the second half, Angling Direct is confident that year to January 2022 EBITDA will be no less than the £4 million generated last year, even taking into account considerably reduced government support.
CEO Andy Torrance commented: ‘Despite the challenges brought about by the pandemic, we have remained focused on driving operational excellence and taking our seamless omni-channel proposition to new and existing angling communities.
‘Our market leading offering means we are well positioned to leverage the growing interest in fishing, and we look forward to further updating shareholders at the interim results in October.’
Singer Capital Markets’ Matthew McEachran insisted ‘the investment case has strengthened over the last two years and, reflecting the group’s long term growth potential and strong balance sheet, we have a high conviction positive stance.’
