Gear4music Regulatory News (G4M)

5 September 2017

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 2017.

Highlights

· 44% increase in total revenue with continued strong growth in the UK and across Europe

· Active customer numbers increased by 44% to 390,000

· Strong start for new distribution centres in Sweden and Germany

Gear4music's Chief Executive Officer, Andrew Wass, said:

"We are very pleased with our trading performance over the last six months, with 44% revenue growth being ahead of our expectation for H1 as indicated at the start of the year, and equates to two-year growth of 150%.

Revenue growth in our core UK market continues to be strong, alongside very strong growth in our international markets, driven by our new distribution centres improving our customer proposition resulting in market share gains across Northern Europe.

A period of investment into our proposition and infrastructure in H1 has increased our operational costs and restricted margins in the short term. Encouragingly, revenue growth over the last six weeks supports our expectation that, as previously stated, revenue and profitability is likely to be more H2 weighted in FY18 than in FY17.

We remain focused on delivering long-term sustainable growth through investment in our people, products, websites and operational capabilities, and raising £4.2m growth capital in May 2017 has enabled us to start accelerating investment in these key areas. The Group continues to trade in line with our expectations and is well prepared for a busy seasonal period."

The Group will report interim results for the six months ending 31 August 2017 on Tuesday 24 October 2017.

- Ends -

For further information, please contact

Gear4music +44 20 3128 8100

Andrew Wass, Chief Executive Officer

Chris Scott, Chief Financial Officer

Panmure Gordon +44 20 7886 2500

(Financial Adviser, Nominated Adviser and Broker)

Andrew Godber / Peter Steel - Investment Banking

Erik Anderson / Tom Salvesen - Corporate Broking

MHP Communications (Financial PR) +44 20 3128 8100

Andrew Leach

Simon Hockridge

Pete Lambie

About Gear4music.com

Operating from a Head Office in York, showrooms in York and Sweden, and Distribution Centres in York, Sweden and Germany, 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, Europe and, more recently, into the Rest of the World.

Having developed its own e-commerce 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.