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Kogan beats FY17 forecast in first half following strong Christmas trading

17 Jan 2017

Kogan.com, which last year acquired Dick Smith’s online business, has beaten its full year forecast in the first six months of the financial year, with a ‘strong’ performance in the Q2 Christmas trading season aiding results.

The company says it exceeded its full-year FY17 prospectus forecast pro-for a EBITDA (earnings before interest, tax, depreciation and amortisation) of AU$6.9 million in the first half of FY17 and ended the second quarter with cash of $26.5 million.

Receipts from customers for the quarter ending 31 December hit $76.6 million, with year to date receipts at $145.1 million.

Ruslan Kogan, Kogan.com founder and chief executive, says the online trader, which listed on the ASX in last July, saw strong demand for new products during Christmas trading, with that demand continuing post-Christmas.

“The team is also pleased to see the investment in systems, architecture and automation made in the years leading up to our IPO delivering positive results as we start to scale the business,” Kogan adds.

He made note of the company’s healthy inventory level of recently received stock following the deployment of IPO proceeds into inventory.

As at 31 December the company had inventory of $41.8 million, including $32.3 million in the warehouse, with the remainder in transit. That’s up from inventory of $28.3 million at 30 September, of which $18.1 million was in the warehouse.

Almost 90% of the stock in the warehouse at 31 December was received during the quarter highlighting inventory turnover.

“With a health cash balance and the company’s best ever level of quality inventory, we believe Kogan.com is well placed to continue the strong momentum generated in the first half,” Kogan says.

He says the company is closely monitoring ongoing trading performance and will consider whether a further update to the company’s outlook is required at the conclusion of the auditor’s half yearly review, which is currently being undertaken.

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