Adore Beauty outperforms after just months on ASX

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Online beauty retailer Adore Beauty is likely to smash its full-year sales and earnings forecasts after just a few months as a publicly listed company after reporting a surge in sales for the first half of the financial year.

At Adore’s inaugural interim result on Tuesday, the business said its sales for the six months to the end of December rose 85 per cent to $96.2 million. The pure e-commerce retailer has been a major beneficiary of more people shopping online during the pandemic.

Adore was founded by now-chairman Kate Morris in her garage in Melbourne more than 20 years agoCredit:Eamon Gallagher

This result beat the company’s prospectus forecasts by 8 per cent and was also above Adore’s own forecast in December. Net profit after tax more than tripled off a low base to $3.1 million, and earnings before interest, tax, depreciation and amortisation (EBITDA) also came in well ahead of prospectus forecasts at $5.2 million.

Adore was founded by now-chairman Kate Morris in her garage in Melbourne more than 20 years ago when e-commerce was a foreign concept to most shoppers. The makeup and skincare seller listed on the ASX in late October and was a popular float, attracting significant interest from retail and institutional investors. However, its shares are currently trading below its $6.75 listing price.

Various costs associated with the retailer’s IPO, along with share-based payments to staff members, hurt the company’s bottom line, with Adore’s statutory EBITDA falling to a $760,000 loss.

The retailer is also closing in on a million active customers, reporting 777,000 at the half, up 82 per cent.

“We have been thrilled to welcome many new customers to our platform over the last six months and are pleased to continue to be the online beauty shopping destination for our loyal customers,” chief executive Tennealle O’Shannessy said.

“Looking forward, we are executing a clear strategy to cement our online market leadership position, and we are well-positioned to capture market share in a large and growing market benefiting from structural tailwinds.”

The company expects to deliver full-year revenue growth above pre-COVID levels thanks to the continued shift of shoppers online. Adore did not declare a dividend.

In early trade, Adore Beauty shares are 6.1 per cent higher at $6.05.

More to come

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