Sosandar upbeat on 'strong' set of results

Fashion brand Sosandar reported an “exceptionally strong” set of final results on Tuesday, with revenue rising 142% year-on-year to £29.5m.

The AIM-traded firm said that included three consecutive months of record revenue in September, October and November.

EBITDA improved “significantly” to a £0.2m loss for the 12 months ended 31 March, narrowing from a £2.9m loss in the 2021 financial year, with every month in the second half being profitable.

It reported an increase in its gross margin to 56% from 48% year-on-year, reflecting a return to normal trading conditions following the impact of the Covid-19 pandemic on the prior year.

Net cash stood at £7m as at 31 March, up from £3.9m a year earlier, reflecting the company’s equity fundraise in May 2021, subsequent investment in stock, and its profitable second half.

Post-year end, Sosandar reported a “very strong” start to the first quarter of the 2023 financial period, with revenue of £10.4m representing a record quarter, and an increase of 81% against the first three months of 2022.

Trading was in line with market expectations, with strong performance on both the company’s own site and with third parties.

The board said the first three months of the new financial year continued to be profitable, resulting in nine consecutive months of profitability, with product across all categories selling through rapidly and “particularly strong” sales of workwear, occasion wear and holiday clothes.

Cash at 30 June totalled £6.1m, reflecting further investment in inventory and continued strong trading.

“We are incredibly proud to be reporting another period of sustained growth for Sosandar,” said co-chief executive officers Ali Hall and Julie Lavington in a joint statement.

“It is thanks to our well-planned approach, together with our entrepreneurial, agile culture that we have delivered a significant increase in revenue, as well as moving into month-on-month profitability.

“This is an important milestone for us, and having achieved it we are now better positioned than ever for further success.”

The CEOs said that, notwithstanding the current macroeconomic environment, trading in the new financial year had started “very well”, with a record quarter for sales and three further consecutive months of profitability.

“With the arrival of spring and summer, we have seen our customers seek out a wide variety of product, in particular smart clothes for work, bright colours for holidays and investment pieces such as leather.

“Looking ahead, we are excited for the next stage of our growth.

“Our winning formula is evident in our results and over the next year we will focus on expanding our product range and continuing to drive growth through our own site and third parties.”

Hall and Lavington said return rates were in line with the firm’s expectations across the product range, and its costs continued to be “carefully” managed.

“We continue to expand and diversify our supplier base to support our growth expectations whilst further mitigating risk.

“As we have done over the past two years, we will continue to use our agility and detailed planning to manage the business effectively, as we move forward on our journey to becoming one of the largest womenswear brands globally.”

At 1017 BST, shares in Sosandar were up 4.49% at 19.33p.

Reporting by Josh White at Sharecast.com.