A well-known UK-based ecommerce company, has marked a significant financial recovery after a challenging period. The business, which is widely regarded as the UK's first-ever pure play internet furniture retailer, has reported a return to profit for the 12 months ending March 31, 2024. The Huddersfield-based parent company, Buy It Direct, recorded a net income of £142,000, a sharp turnaround from a £10.2 million net loss in the previous year.
Photo: Furniture123.
The positive result was achieved despite a 6.2 per cent decline in overall revenue, which fell to £332.2 million. A major factor in the profit recovery was the improvement in gross margin, which widened by 400 basis points to 28.3 per cent. This was largely due to a realignment of the company's cost base and the successful completion of a stock reduction programme that had been previously outlined.
Although Furniture123's individual performance details were not disclosed, the company did state that all areas of its business, including its furniture division, had continued to trade profitably. A significant portion of Buy It Direct's overall sales comes from its consumer electrical and appliance websites, which also contributed to the overall performance.
Founded by serial entrepreneur Julian Field in the late 1990s, Furniture123 has been under the control of Buy It Direct since 2012. The company's recovery also saw an increase in its net debt, which rose to £7.4 million, up from £4.6 million in 2023. However, net assets also grew slightly to £26.8 million from £26 million in the previous year.
The return to profit for Buy It Direct and its ecommerce portfolio, including Furniture123, signals a positive outlook after a difficult year, demonstrating the company's resilience in the face of market challenges. The results show that despite a decline in revenue, strategic efforts to reduce costs and improve efficiency have paid off, ensuring profitability for the group moving forward.
Source: www.thefurnishingreport.com