York-based online musical equipment retailer Gear4music plc said it returned to revenue growth in October and November but warned it still faced a difficult market. 

The company said it achieved 5% revenue growth in trading to date for the second half of its financial year, “in what continues to be a challenging consumer environment, particularly in our European markets.”

However, it said it was “well-positioned and prepared for the upcoming peak seasonal trading period” and held its full-year outlook in-line with analysts’ average expectations of revenues of £154.7 million, EBITDA of £11.7 million and profit before tax of £2.8 million.

For the first half of the year, it said sales dipped as it had some issues with a new AI-based marketing system. Revenue fell to £61.7 million from £62.6 million a year ago. It said EBITDA rose slightly to £2.9 million, compared with £2.4 million a year ago. 

Andrew Wass, Executive Chair, said: “Aware of the potential for ongoing weakness in the European consumer retail environment, we maintained a disciplined approach to cost management during FY25 H1, contributing to a further reduction in our net debt. While the recent UK budget will introduce additional employment costs from FY26 onwards estimated at £0.3m, we are confident these can be largely mitigated through further cost-saving measures.”

“Our long-term focus remains on growing higher-margin revenues, and we will continue to invest in areas that support this objective, such as the Studiospares acquisition announced on 22 October 2024, our second-hand platform, and our own-brand product offering, teams and infrastructure.”

“Our full-year outlook remains in-line with consensus market expectations, we are well prepared for our seasonal peak trading period, and look forward to providing a further trading update after the Christmas period on 21 January 2025.”