York-based online musical equipment retailer Gear4music plc said its sales in the three month to December 31, 2021, fell 10% to £47.2 million from an “exceptional” £52.2 million in the same period of 2020.
But the sales were up 17% on the £40.3 achieved in the same quarter of 2019.
In a trading update for the three months to December 31, Gear4music said gross margins remained strong at 28.4%, compared to 26.2% in FY20 Q3 and an exceptional 29.9% last year.
It said gross profits increased 27% compared to FY20 Q3, and robust UK sales were 24% ahead of FY20 Q3 and 13% ahead of FY21 Q3.
FY22 EBITDA continues to be in-line with consensus market expectations.
The company said its new European distribution centres are scaling up well to address post-Brexit problems “which as previously reported have impacted European sales.”
Gear4music CEO Andrew Wass, said: “We are pleased to report that financial performance during the FY22 peak seasonal trading period was in line with the board’s expectations, demonstrating good progress when compared with the same period in FY20.
“UK sales growth continued to be robust against what were exceptional revenues last year, and as previously reported, European growth has been restricted due to short term Brexit related challenges.
“We are continuing to make good progress in scaling up our new European distribution centres in Ireland and Spain to strengthen our European customer proposition, and we expect European revenues to regain momentum as we head into FY23.
“Following the successful acquisition of AV Distribution Ltd in December 2021, we were very pleased to have successfully launched AV.com as scheduled on 13 January 2022.
“AV.com is currently focused on retailing Home Cinema and HiFi equipment and accessories and significantly increases our addressable market size.
We have a strong pipeline of new products, e-commerce system developments and new website features due to be launched throughout FY23, and as such, we remain confident in our long-term profitable growth strategy.”