Womenswear retailer Sosandar’s half-year update on Tuesday talked of a “return to revenue growth and resilient gross margins in H1” with its trading being in line with full-year expectations.
Sosandar
What that meant in practice for the six months to the end of September was net revenue up 15% to £18.7 million with own-site revenue up 28%.
Its own site “demonstrated sequential revenue growth in both Q1 and Q2, driven by a meaningful uplift in site traffic, improved conversion rates, and increased order volumes from both new and existing customers”.
And it saw a “sustained strong gross margin of 62.2%”, which was flat year on year.
But it remained loss-making with a wider loss before tax of £1.1 million compared to £0.7 million a year earlier. This was “in line with our expectations and reflecting traditional second-half weighting of profitability”. Its autumn/winter collections tend to be higher-margin and, of course, the half includes the crucial Christmas trading period.
The company also said the H1 loss reflects “the impact of own stores and [the] M&S cyber incident”.
M&S is one of the stores through which the brand sells and the cancellation of online sales by the retail giant for several months will have impacted a large number of third-party brands. Sosandar’s sales through M&S have now resumed.
But the rest of its retailer partnerships remain strong. Sosandar is one of the top-selling brands across all third-party partners, including Next, “delivering robust trading during the period and entering the key autumn/winter season with positive momentum”.
As expected, and as outlined in its July trading update, the label’s stores “continue to weigh on profitability as they mature”. The company said it remains “focused on improving store performance and progressing towards breakeven, with no further openings planned at this time”.
Ali Hall and Julie Lavington, joint-CEOs, said: “We remain incredibly excited for what lies ahead for Sosandar as we leverage the multiple opportunities available to us to expand the brand’s presence across the UK and international markets, progressing towards our goal of becoming one of the leading global womenswear brands. The board reiterates its confidence in delivering market expectations for the current financial year with the foundations now in place for sustainable, profitable and cash-generative growth over the medium to long-term.”
