Marks Electrical delivers record third quarter

Online electricals retailer Marks Electrical reported a record third quarter of trading on Monday, with revenue growing 27.4% year-on-year to £22.3m.

The AIM-traded firm said that included a strong performance during the seasonally-important Black Friday and Christmas periods.

It said year-to-date revenue growth stood at 55.0%, to £59.8m, keeping the business on track to deliver its 2022 financial year revenue target.

The board said further operational leverage was driving margin expansion, with the group on track to achieve its full-year adjusted EBITDA margin target of 9%.

It also maintained its inventory levels during peak trading periods, with the board adding that its focus on working capital management was continued.

On the operational front, Marks said its growing in-house fleet of delivery vehicles reached record delivery volumes during the quarter, with scope for further capacity use as the company expanded.

The firm’s market share in the major domestic appliances segment continued to grow in the period, with the company reporting a “strong” performance in televisions, with year-to-date revenue there up 103% year-on-year.

Marks also improved its Trustpilot rating from customers to 4.8 out of a possible five, from 4.7.

“I am delighted by our performance in the third quarter of this year, with year-on-year growth of 27.4%, and continued trading momentum against particularly strong comparatives,” said chief executive officer Mark Smithson.

“This high growth rate allowed us to continue to gain market share.

“In order to improve brand awareness, we continued our investment in TV campaigns, leading to increased website traffic and promoting the Marks Electrical brand.”

Smithson said that, combined with the company’s revised approach to digital marketing, helped attract new customers to its site.

“We've continued to work closely with all our suppliers in order to maintain inventory levels during the period, and have successfully coped with the continued surge in demand for our products, achieving record delivery numbers and ensuring we maximise the value on each vehicle.

“In a market with supply issues, this demonstrates the strength of our relationships with our suppliers and the agility of our business model to cope with peak demand.

“I am particularly proud of our further improvement on Trustpilot from 4.7 to 4.8, recognising the market-leading customer service that we provide.”

Mark Smithson said the company’s staff delivered a record quarter, handling increased throughput in its warehouse and through its team of delivery drivers.

“Our call volumes have increased materially and our team has stepped up to deliver during the busiest time of the year, demonstrating the agility of our colleagues and business model to adapt quickly when volumes increase.

“Our momentum has continued into January and we look forward to maintaining our performance management discipline on revenue, profit and cash in the final months of the year.”

At 1021 GMT, shares in Marks Electrical Group were down 0.59% at 118.8p.