Temple & Webster shares drop despite sales lift
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More news: Shares in Temple & Webster are down nearly 1.5% to $12.35 after despite the online furniture retailer reporting a 21% lift in fiscal year-to-date sales.
Citi analysts said the update indicated a slight moderation in the growth run-rate. Citi holds a 'buy' rating on the stock with a price target of $13.50 a share.
What they said: "TPW's October update recorded 21% year-on-year [YoY] growth for 1H25-to-date vs. 26% at its mid-August update. This implies that YoY growth slowed to 18% YoY between late-August and October," the analysts said in a note.
"The moderation for exit sales run-rate is concerning but the period is partly cycling a very strong 42% trading update (Oct-Nov) from the prior corresponding period. Underlying momentum actually improved.
"... The update could still be consistent with TPW achieving a 25% top-line growth for FY25."
Temple & Webster sales up 21%, reaffirms margin guidance
The news: Online furniture retailer Temple & Webster has reported a solid lift in year-to-date revenue and reaffirmed its full-year earnings margin guidance despite cost-of-living pressures hurting customers.
The numbers: The company said revenue for the period till 24 October was up 21% from a year ago. The company holds a strong balance sheet position with over $100 million in cash and no debt.
The context: The group said it had seen significant market share gains so far this fiscal year despite the ongoing cost-of-living crisis. They said there was good momentum in leading indicators, with average order values back to growth and 60% of orders now from repeat customers.
It said margin levels remained within its target range despite some increases in international freight rates. It reaffirmed full-year earnings margin guidance of 1% to 3% and said it is on track for more than $1 billion in annual sales in the mid-term.
The company expects November and the Black Friday sale period to be of increasing importance.
The source: ASX announcement
