The Temple & Webster Group Ltd (ASX: TPW) share price is charging higher this morning.
In early trade, the online furniture and homewares retailer’s shares are up 7% to $12.43.
Why is the Temple & Webster share price charging higher?
The catalyst for the rise in the Temple & Webster share price on Tuesday has been the release of its unaudited full year results which revealed record revenue, profits, and customer numbers.
For the 12 months ended 30 June, the company reported an 85% increase in revenue to $326.3 million. This comprises first half revenue of $161.6 million and second half revenue of $164.7 million.
As expected, the company’s operating margins narrowed during the second half as management invests to capitalise on strong e-commerce growth.
This led to earnings before interest, tax, depreciation and amortisation (EBITDA) coming in 141% year on year at $20.5 million. This represents an EBITDA margin of 6.3%, down from ~9.2% during the first half.
A key driver of its growth in FY 2021 was another strong increase in customer numbers. At the end of the period, Temple & Webster’s active customers were up 62% year on year to 778,000. This means the company added 100,000 new active customers in the second half of the financial year.
Also supporting its sales growth was a 12% increase in average revenue per active customer and increased repeat purchasing.
Temple & Webster’s CEO, Mark Coulter, commented: “Once again Temple & Webster has delivered a record result. Revenue grew 85% across the year driven by strong growth in new and repeat customers and average order values. While lockdowns during FY20 and FY21 have accelerated the underlying shift from offline to online, pleasingly we continue to see strong growth even when comparing against Covid impacted numbers.”
“While the start of FY22 has been difficult for many Australians, we remain focused on delivering a great experience for our customers, built around the biggest and best range of furniture and homewares, combined with inspirational content and services and a great delivery experience and customer service,” added Mr Coulter.
FY 2022 trading update
Also giving the Temple & Webster share price a boost today was management’s update on its performance early in FY 2022.
The release explains that FY 2022 has started strongly with year on year revenue growth of 39% for the period 1 July to 24 July.
Management also advised that the company continues to experience strong tailwinds. This includes the ongoing adoption of online shopping due to structural and demographic shifts, an acceleration of these trends due to COVID-19, an increase in discretionary income due to travel restrictions, and strong housing market growth.
Looking ahead, the company intends to continue its reinvestment strategy, investing into growth areas of the business to grow its online market leadership position. This is part of its ultimate goal of becoming the largest retailer (online and offline) for furniture and homewares in Australia.