Angling Direct ends another 'challenging' year strongly

Fishing tackle and equipment retailer Angling Direct said in an update on Tuesday that it had continued to trade in line with its expectations, and expected to report a 7.2% increase in revenue for the 2022 financial year, to £72.5m.

The AIM-traded firm noted that would be against “exceptional” sales in 2021 of £67.6m, and would represent a 36.3% increase on a two-year basis.

It said that strong performance was achieved despite all of its retail stores being forced to close between 1 February and 11 April due to Covid-19 restrictions, and then only being able to operate on a ‘call and collect’ basis for a period.

Angling Direct said its growth was driven by robust store sales as Covid-19 trading restrictions eased during the year.

Total store sales increased 19.9% to £38.7m, or 38.4% on a two-year basis, while the total number of stores increased to 42 from 38 over the year.

Since its interim results on 13 October, the company had opened new stores in Ipswich in November, and in Southampton and Cheltenham in January.

Those stores, along with Redditch which opened in February 2021, contributed £0.7m in sales in the period.

Like-for-like store sales increased 14.1%, partly as a result of fewer lost trading days due to Covid-19 restrictions.

As expected, total online sales declined by 4.3% to £33.8m, against the “exceptional” prior year, but on a two-year basis grew 33.9%.

UK online sales, representing 92% of total online sales, increased 2.7%, while the firm’s European sales reduced 39.3%, with its key Europe territories of Germany, France and Netherlands declining 21.8% as the company was impacted by increased export costs and customer fulfilment times post-Brexit.

Going forward, the board said it expected a return to growth in Europe as a result of the imminent opening of its European distribution centre, which was progressing to plan.

Additionally, towards the end of the period the firm launched its new web trading app in the UK, with initial feedback said to be “encouraging”.

On the earnings front, Angling Direct said it expected to report pre IFRS-16 EBITDA of no less than £5m, in line with market expectations and representing a “significant improvement”, with growth of over 25% on the prior year.

The board added that Angling Direct’s “strong” trading performance and associated cash conversion had mitigated working capital investments, leading to a 10.7% improvement in its cash position as at 31 January, to £16.6m.

“We are extremely pleased with the company's trading performance through what has been another challenging year,” said chief executive officer Andy Torrance.

“Despite significant government restrictions endured during the period, we have delivered against our operational and strategic objectives.

“We have reported record revenues, opened four new stores and continued to invest in our long-term growth strategy, including the imminent opening of our Europe distribution centre in the Netherlands.”

Torrance said that investment, as well as its investment in technology and strong balance sheet, left the company “well-positioned” to accelerate its growth strategy.

At 1435 GMT, shares in Angling Direct were down 1.33% at 55.75p.