Sosandar PLC (LON:SOS) shares moved up on Monday as the women’s online fashion brand upgraded its full year forecasts after a record quarter.
In a trading update for the three months ended 31 December, the AIM-listed firm said revenues in the period were “above management’s expectations” at £3.8mln, a 136% increase on the same period a year ago and more than the £2.8mln generated for the first half of the financial year.
READ: Sosandar hits "special milestone" as monthly sales double in October
Sosandar said the revenue surge has been driven by an expanded product range as well as increased TV investment following a successful trial in September.
“The performance of TV was especially pleasing given this is a peak period where competition is high and cut through can be difficult”, the company said, adding that following the increased investment its active customer base has jumped 93% year-on-year to over 110,000.
December saw the biggest uplift in revenues in the period, rocketing 153% year-on-year, while the company said the momentum had continued post-period with January sales tracking up over 160%.
As a result of the upswing, Sosandar now expects its revenues for the full year to be “ahead of market expectations”, however, increased investment in growth meant that the net loss for the year was now predicted to be higher than previously anticipated.
“It is pleasing that, as expected, following our increased investment in marketing, product and team we are seeing accelerated growth across all our [key performance indicators]… The opportunity we identified appears to be bigger than we first thought, with the success of new product areas helping to drive repeat purchases increasing the potential for future ranges”, said Sosandar’s joint chief executives Ali Hall and Julie Lavington.
"Acquisition of customers is nothing without successful retention and that's why it is so pleasing to see that repeat customers in January, a traditionally difficult trading period, are tracking higher than in the peak Autumn/Winter period helping to continually improve the ever-growing lifetime revenue number”, they added.
In a note on Monday, analysts at Sonsandar’s house broker Shore Capital said the retailer had been “top of the tree this Christmas” and had outperformed all other UK clothing retailers despite its lower sales base.
“In our view, the company remains firmly on track to reach breakeven in [2021] and be cash generative in [its second half]. We believe that the company is on the right path to scale and is investing appropriately for the future”, they added.
Sonsandar shares were 0.9% higher at 28.5p.