Candy Club (ASX:CLB) share price flat despite 192% revenue increase

The Candy Club share price remains flat today despite the company reporting significant revenue and customer increases in its Quarterly Activities Report.

| More on:
flat asx share price represented by investor shrugging

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

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.

Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Retail Shares

Close-up of a woman waring a hay and smiling as she carries shopping bags over her shoulder.
Consumer Staples & Discretionary Shares

Why these ASX retail shares are surging while the market dives

These shares are avoiding the selloff. But why?

Read more »

surging asx ecommerce share price represented by woman jumping off sofa in excitement
Retail Shares

Meet the ASX retail stock that could double in value

I’d definitely put this retail stock in my shopping basket.

Read more »

a woman wearing fashionable clothes and jewellery checks her phone with a satisfied smile on her face in a luxurous home setting.
Retail Shares

Down 48% in 2024, why did this ASX 300 stock just surge 10%?

Investors are sending this ASX 300 stock surging today. But why?

Read more »

A senior pharmacist talks to a customer at the counter in a shop
Retail Shares

Wesfarmers share price rises amid healthcare expert appointment

Wesfarmers has appointed someone with a healthy amount of experience.

Read more »

JB Hi-Fi staffer helping customer share price
Retail Shares

JB Hi-Fi shares leap to record high despite legal scuffle

The corporate watchdog is alleging The Good Guys haven't been such 'good guys' after all.

Read more »

Emotional euphoric young woman giving high five to male partner, celebrating family achievement, getting bank loan approval, or financial or investing success.
Retail Shares

The Wesfarmers share price rocketed 32% in FY 2024! Here's how

Wesfarmers shares smashed the benchmark in FY 2024. But how?

Read more »

A woman peers through a bunch of recycled clothes on hangers and looks amazed.
Opinions

Is this the best dividend share in the ASX 200?

I think this cheap ASX retail share is one of the best ASX dividend shares to buy now.

Read more »

JB Hi-Fi staffer helping customer share price
Retail Shares

How ASX 200 retail shares just got a boost from 'watchful shoppers'

ASX 200 retail shares just enjoyed a boost from the latest ABS retail sales report. But why?

Read more »