Gear4music Regulatory News (G4M)

6 September 2016

Gear4music (Holdings) plc

Trading Update

Gear4music (Holdings) plc ("Gear4music" or "the Group"), the largest UK based online retailer of musical instruments and music equipment, today announces a trading update for the six months to 31 August 2016.

Highlights

· Very strong sales growth throughout the period, particularly into Europe

· Active Customer1 numbers increased by 45% from 187,000 to 271,000

· First European distribution centre scheduled to open in Sweden in November 2016.

Gear4music Chief Executive Officer, Andrew Wass, said:

"We are very pleased to have sustained the strong sales momentum announced on 29 July and achieved 73% like-for-like revenue growth during the half year, and overall profitability in the period will be ahead of management expectations as we head into the key second half trading period. This impressive growth reflects our focus on continual investment in and improvement of our product range, websites, systems and overall customer proposition, and the commitment of our hard working team.

"Reassured by this sales growth, we are continuing to invest in the business, including establishing our first European distribution centre that will be located in Sweden, which we expect to be operational from November this year.

"This centre will improve our delivery times to customers throughout much of Scandinavia, whilst at the same time reducing delivery costs in those territories. We are also working towards opening a second European hub before the end of this calendar year.

"These first two distribution hubs will not only transform our European customer proposition, but also increase the overall capacity of our business to deliver over £100m revenues. This additional distribution capability will also be augmented with localisation of some purchasing and merchandising functions, ensuring the business is well placed for any Brexit eventuality."

The Group will report interim results for the six months ending 31 August 2016 on Tuesday 18 October 2016.

- Ends -

For further information, please contact:

Gear4music +44 843 155 0800

Andrew Wass, Chief Executive Officer

Chris Scott, Chief Financial Officer

Panmure Gordon +44 20 7886 2500

(Financial Adviser, Nominated Adviser and Broker)

Fred Walsh / Peter Steel / Duncan Monteith - Investment Banking

Erik Anderson / Tom Salvesen - Corporate Broking

MHP Communications (Financial PR) +44 20 3128 8100

Andrew Leach

Simon Hockridge

Isabelle Grainger

Background to Gear4music

Operating from an office, showroom and distribution centre in York, the Group sells own-brand musical instruments and music equipment alongside premium third party brands including Fender, Yamaha and Gibson, to customers ranging from beginners to musical enthusiasts and professionals, in the UK and, more recently, into Europe.

Having developed its own ecommerce platform, with multilingual, multicurrency and fully responsive design websites covering 19 countries, the Group has rapidly expanded its database and continues to build its overseas presence.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.