(Alliance News) - Online musical equipment retailer Gear4Music Holdings PLC said Tuesday its loss interim improved as its revenue rose as it continues to target profitability.
Shares in York-based Gear4music were 6.8% lower at 226.00 pence in London on Tuesday.
For the six months ended September, pretax loss improved to GBP279,000 from GBP545,000 the year prior. This was after revenue rose to GBP49.4 million from GBP42.5 million the year before.
"This has been an important period of balancing sales growth with our primary objective of improving gross margins and profitability, and I am pleased to report tangible evidence that we are making good progress in achieving that objective," Chief Executive Officer Andrew Wass said.
"Having grown our revenues by more than 350% over the last four years, our recent focus has been on ensuring that our operational infrastructure is able to keep pace with our increased scale, and I am very pleased with the progress we have made during the period in further developing our back-end systems and logistics platform," Wass added.
During the period, Gear4music reported the average order value fell to GBP120.05 from GBP127.48 a year prior. And, despite website and mobile visitors growing, the conversion rate fell to 3.02% from 3.22% the year before.
"Having made these improvements, we expect to rebalance our development resources back towards growth orientated projects from next year, which alongside further systems improvements, we are confident will deliver long term growth in profits and revenues," Wass continued.
"As we approach the Christmas trading period, we will remain focused on improving profitability rather than driving growth in market share, particularly in the UK where the market remains highly competitive," Wass said.
"Having appropriately reconfigured the business, we now expect gross margins to be higher and revenues to be lower than previous guidance, reflecting our focus this year on building a sustainable platform for growth in all areas," Wass added. "We believe that this is the right strategy for the delivery of long-term shareholder value and we remain confident that the business is well-positioned."
By Ahren Lester; ahrenlester@alliancenews.com
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Gear4music (G4M)