The Adore Beauty Group Ltd (ASX: ABY) share price is up more than 7% after announcing its FY24 trading update.
This update covers the three months to 30 September 2023 compared to the prior corresponding period of the three months to 30 September 2022.
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First-quarter trading update
Adore Beauty reported that its revenue grew 4.7% year over year to $47.5 million. Active customers increased 1.5% to 803,000 and returning customers went up 4.7% to 497,000.
The e-commerce business said that its mobile app now represents more than 26% of all revenue, highlighting the importance of its own sales channel. This was an increase of 1.9 percentage points from June 2023.
Adore Beauty also said that its sales were boosted by "highly successful loyalty and promotional activity."
The company revealed that it had onboarded a number of in-demand consumer brands recently including Nyx, Davines, Ralph Lauren, Viktor & Rolf, and Mugler.
Other highlights
Adore Beauty said that its 'subscribe and save' service is now available with 18 brands including SkinCeuticals, Alpha H, Lancome, AB Lab, ELEVEN, Viviology and Ultra Violette.
The idea with the subscription service is that customers can have an automated six-to-12-week replenishment service. Additional partner brands will be "added over time".
Pleasingly for the company, Adore Beauty's private label brands "continue to grow".
The e-commerce business said that despite ongoing cost of living pressures and weaker consumer sentiment, it is "on track" to achieve an earnings before interest, tax, depreciation and amortisation (EBITDA) margin of between 2% to 4% in FY24.
Solid start to FY24
The Adore Beauty CEO Tamalin Morton commented on the company's performance in FY24 to date:
While trading conditions remain challenging, Adore Beauty has had a solid start to FY24, with both revenue and active customers up on the same period last year. Encouragingly, active customer numbers have now returned to growth, and we continue to see positive momentum with a comprehensive offering that provides real value-added benefits.
We continue to prioritise customer experience and convenience, augmenting our offering to now include a subscription service across popular brands. Our 'Subscribe and Save' offer ensures customers receive their frequently used products at the right time and best price. The offer has been designed to reduce friction for customers, support loyalty and retention, and improve average order frequency.
It was noted that the coming quarter, which includes Black Friday and Christmas shopping, is a key trading period for the business.
Adore Beauty share price snapshot
Over the past month, the Adore Beauty share price has gone up by 30%, as we can see on the chart below.
