Sosandar PLC (AIM: SOS), the online women's fashion brand, is pleased to announce the following trading update ahead of its Interim Results for the half year ended 30 September 2018.
The Company is delighted to announce that it expects to report revenue for the period of £1.84 million, a 407% increase against the same period in the prior year.
Sales momentum has continued throughout the summer and into the start of autumn with record monthly revenues achieved in September 2018. Sales are strong across all product categories, including higher value items such as coats and leather.
This strong growth reflects the continued success and increasing efficiency of the Company's customer acquisition activities across multiple channels. Sosandar's content-driven marketing strategy, utilised across all its digital and print media platforms, has been further enhanced by a diverse and growing celebrity and social influencer fanbase. This directly impacts sales but also increases brand appeal and awareness as shown by Facebook and Instagram followings which have grown over the year to 30 September 2018 by 129% and 193% respectively.
Investment in data analysis has underpinned the Company's ability to provide better targeting and more personalised engagement with customers, ultimately leading to more effective use of marketing spend and efficiencies in customer acquisition. This is illustrated by the number of new customers increasing 362% during the period compared to H1 2017, ahead of management's expectations.
Continuing the trend seen previously, over the last six months customers have been repeat ordering more frequently and with a higher basket size, demonstrating the appeal of the Company's unique design aesthetic and customers' growing loyalty to the Sosandar brand.
Gross margin for the period is expected to be 55% (46% H1 2017), a significant improvement on the prior period achieved through higher levels of stock sold at full price, a very low level of discounting taking place during the summer months and improvement in the Company's buying power as scale and repeat business builds.
Returns levels have increased during the period for two principal reasons: higher than anticipated levels of customer acquisition, as new customers find their correct fit; and a particularly high demand for dresses during the Spring/Summer period. Dresses have higher return rates due to a more complex body fit. Management expects the returns rate will be lower at the full year, reflecting the different product mix in Autumn/Winter.
As announced at the Company's AGM on 19 September 2018, the Company has also made operational advancements including working with its partner, Clipper Logistics, to move to a seven day a week service and upgrading its e-commerce platform to Magento 2. Both these investments demonstrate commitment to building for growth whilst providing the best customer experience. These will, in turn, provide the growing number of repeat customers with improved delivery options and increased functionality as the Group continues to scale up.
Growth is being delivered across KPIs as shown below:
6 months ended 30 September 2018
6 months ended 30 September 2017
Number of orders
Average Order Value
Ali Hall and Julie Lavington, Joint CEOs, commented:
"The business has made substantial progress over the first six months of the year, and we are delighted to have delivered such strong growth in revenues, orders and new customers. Pleasingly, this has been accompanied by a growing number of repeat customers and an increased average order value, as those customers already recruited become brand ambassadors. Our clothes have become a mainstay in our customers' wardrobes - including celebrities - and we are proud that our garments are being worn by high profile actresses, TV presenters, sports stars and social media influencers.
"At the same time, we have been able to make key operational progress that will further enhance the customer experience and have increased the efficiency of our marketing spend. Momentum has continued into the important Autumn/Winter period and we look forward to the rest of the year confidently."