The Candy Club Holdings Ltd (ASX: CLB) share price remains flat today despite the company reporting significant revenue and customer increases in its Quarterly Activities Report.
The Candy Club share price is currently trading for 22 cents per share.
Candy Club is a confectionary retailer that specialises in retailing candy boxes in both B2B and B2C markets. It's heavily US-centric and garners most of its revenue from either B2B or supplying huge US retail chains.
Candy Club revenue increases
Candy Club announced its results today for the three months ending 31 March 2021: its first-quarter FY2021 results.
The company has made total gross revenue of US$4.13 million in 1Q FY2021, representing an increase of 192% year-on-year (YoY). This was driven by its B2B division, which posted US$3.4 million gross revenue during the quarter.
This is a 21% increase quarter-on-quarter (QoQ), or 423% growth YoY. The company says this is particularly impressive considering the "persistent headwinds" created by the coronavirus pandemic.
The company's B2C business also experienced good growth in the period, as it was up 49% versus the prior quarter.
Customer increases heavily US-focused
The company's total number of retail doors grew further to more than 17,000. At the same time, the number of B2B customers exceeded 10,000 as of 1Q FY2021.
Its larger brick-and-mortar customers continued to grow QoQ. Additionally, the majority of its existing national and regional department and gift store chains reordering.
The company also added several impressive new account wins including the giant US national retailer JC Penny. Fellow rival Macy's has also expanded Candy Club's presence by selling the company's candies in more stores and expecting further growth. Re-order rates for the company's top 25 customers held over 90% for the quarter.
Candy Club expecting future growth
While Candy Club's U.S. results appear strong, Australian investors are obviously less excited by the news. Furthermore, the Candy Club share price has remained flat. Nevertheless, the company expects strong growth moving forward.
Candy Club's B2B division remained strong in 1Q FY2021, achieving quarterly record revenue of approximately US$3.4 million. The company's strong performance comes amid the challenging operating environment in the US, which continued to be impacted by the COVID-19 pandemic.
While the thousands of small businesses derived from the company's e-commerce strategy are driving the recent growth, Candy Club expects the traditional US brick-and-mortar retailers to significantly grow the company's overall business by 2H FY2021.
Candy Club share price movements
The Candy Club share price is down more than 6% over the past week and month, but the company has gained more than 300% over the past 12 months.
