Gear4Music swings to full-year loss despite sales increase

The specialist etailer posted a loss before tax of £600,000 for the 13 months to March 31, 2019 compared with a £1.5m profit for the same period the previous year.

The music retailer’s EBITDA declined 34% to £2.3m despite sales rising 48% to £118.2m during the same period.

Gear4Music attributed its sales growth to “implementing our core strategy of best-in-class customer service, ecommerce excellence, bespoke platform development, international expansion, and supply chain evolution”.

However, the etailer suffered challenges due to the “business growing rapidly”, including capacity problems at its York distribution centre over the Christmas period and two separate profit warnings during the financial year.

Gear4Music chief executive Andrew Wass said: “Alongside delivering strong revenue growth in the period, we have worked hard to implement a number of commercial and operational initiatives to address the previously reported issues.

“Our FY20 H1 focus is on improving gross margins and ensuring a robust operational infrastructure is in place ahead of our peak H2 trading period, and I am pleased to report these actions are already yielding positive results.

“We are confident that we have the right strategy, customer proposition, financial resources and focus to overcome the challenges of FY19, and achieve our objectives of maximising customer satisfaction and delivering value to shareholders.”