Sosandar hails record quarter despite lockdown impact
Online retailer Sosandar reported improved third-quarter revenues on Wednesday despite fresh lockdown restrictions forcing it to slash its marketing budget.
The woman’s fashion brand saw revenues rise 6% in the three months to 31 December, to £3.98m, while the underlying loss was reduced by around 60%. It did not give a figure for the loss, however, and remains loss-making
Marketing spend was cut by £1.6m, or 66%. As at 31 December, net cash stood at £3.9m as
The AIM-listed firm noted: "This record performance for a quarter, delivered against very strong prior year comparatives, has been achieved despite the challenging market backdrop and a significant reduction in marketing spend."
The company started the quarter looking to increase customer numbers. But after the introduction of fresh lockdown restrictions, which reduced the opening hours and then shut pubs and restaurants, it switched to preserving cash and focusing on existing customers only.
It has also changed the product mix, with spring ranges planned to reflect current Covid-19 restrictions, which have reduced demand for formalwear. Casual clothing, including knitwear and loungewear, have performed strongly in January, Sosandar said.
Ali Hall, co-chief executive, said: "The agile nature of our business has enabled us to adapt quickly to the challenges and uncertainties within the retail sector. While the external environment continues to be uncertain, the scale of our opportunity has not changed."
Shore Capital said: "The recent trading momentum reflects both the agility and speed of the management team set against the most challenging retail trading conditions in living memory.
"Given the Covid headwinds of 2020, Sosandar has been able to successfully pivot towards casualwear and away from occasion wear, given that consumers remain in lockdown and not currently going ‘out-out’ to social occasions.
"We continue to believe that Sosandar remains in the foothills, and that there remains a significant opportunity for the brand."
Sosandar is a house stock at Shore Capital.
As at 0830 GMT, shares in Sosandar were off 11% at 16.5p.