Gear4music profits and sales soar in harmonious year

Pre-tax profits grew to £2.6m in the twelve months to February 28, from a base of £6,000, in what Gear4music described as a “transformational year”.

Underlying EBITDA more than doubled – up 115% to £3.6m.

It said the “record profits” were driven by improved margin performance.

Sales advanced 58% to £56m across the group, and 124% in its international markets following significant investment in its European infrastructure.

The business opened distribution centres in Sweden and Germany during the period to enhance its European customer proposition.

During the period the etailer has also recruited a software development team to accelerate the development of its e-commerce platform.

Gear4Music chief executive Andrew Wass said: “Our growth has been underpinned by the quality of our bespoke e-commerce platform and we continue to drive innovation in this area to further improve our systems and websites, both in the UK and overseas.”

Active customer numbers surged 50% to 340,000.

Bricks and mortar

Since year-end, the pureplay has secured a 50,000 sq ft site for a new long-term head office in York.

The £5.3m property, due to be completed in June, provides capacity for further expansion as required and is entirely debt-funded.

Last year, Gear4music toyed with the idea of opening a 12,000 sq ft flagship showroom in London, but Wass cooled his interest after admitting property is “too expensive”.

Outlook

Looking ahead, Wass said: “We begin our current financial year with good momentum and continued appetite from customers around the world.

“We are well positioned to deliver further growth and have plans in place to continue investing in our operational facilities and systems to support our growth plans.

“The next 12 months will be exciting as we move into our new head office in York, scale up our European operations, and enhance our worldwide proposition, and we remain confident in the long-term growth prospects for the group.”