The Digital Wine Ventures Ltd (ASX: DW8) share price is starting the week off in the red. This comes after the wine-focused technology investment company announced a trading update for the fourth quarter of FY2021.
Digital Wine shares sank 6.1% to an intraday low of 7.6 cents at the opening of trade. Apart from a late morning rally they have stayed down and, at the time of writing, are trading hands for 7.7 cents a share.
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How did Digital Wine perform in Q4 FY21?
Investors appear to be heading for the hills, selling Digital Wine shares despite the company reporting impressive numbers.
For the three months ending 30 June 2021, Digital Wine achieved $1.02 million in revenue from its WineDepot platform. This reflects a 33% increase on the prior quarter, and a mammoth 274% jump on the previous corresponding period (Q4 FY20). The outstanding result came on the back of strong orders received, along with a number of new suppliers.
WineDepot shipped a total of 75,377 cases throughout the fourth quarter, resulting in a 22% lift on Q3 FY21 (61,939 cases). That's also a significant increase compared to this time last year, when the business shipped 13,840 cases in Q4 FY20.
The average number of cases shipped per order stood at 2.33, however this will likely surge over the coming months. As WineDepot Market grows, trade buyers typically place larger orders than consumers, leading the volume of orders processed.
During Q4 FY21, the company acquired 68 new suppliers, bringing the total number of suppliers using WineDepot's platform to 375.
In addition, Digital Wine touched on some previous achievements that occurred during the quarter. This included securing a liquor licence to launch a wine club called Insider Trading. This is an invitation-only membership program that allows access to private tastings, dinners, master classes and other events.
Furthermore, Digital Wine's WineDepot went live in Melbourne and Sydney, offering a direct-to-trade marketplace for consumers. The company notably partnered with Zip Co Ltd (ASX: Z1P) for a buy now, pay later credit solution, and Amazon (NASDAQ: AMZN) for its logistics network.
Management commentary
Digital Wine CEO Dean Taylor highlighted the company's strong performance, saying:
There's been a noticeable lift in our key metrics over the last 3 months as existing and new suppliers embrace new functionality offered via our platform, such as MARKET & DIRECT. The combination of the new revenue streams generated by these products together with very strong customer growth, generated organically and via strategic acquisitions, provides the basis for a very exciting year ahead in respect of revenue growth.
Digital Wine share price snapshot
In the past 12 months, Digital Wine shares have outpaced the broader All Ordinaries Index (ASX: XAO) to post a 92.5% gain. So far in 2021, the company's share price is up 79%.
Based on today's price, Digital Wine presides a market capitalisation of roughly $128 million, with 1.6 billion shares on issue.
