×
6 602
Fashion Jobs
L BRANDS
Procurement Buyer - Information Technology
Permanent · Columbus
NORDSTROM
Asset Prevention Security Ambassador Downtown Seattle
Permanent · Seattle
NORDSTROM INC
Business Intelligence Analyst - Merchandise Operations
Permanent · Seattle
NORDSTROM INC
District Loss Prevention Manager, ny
Permanent · New York
L BRANDS
Asset Protection Officer, Morse rd (2nd Shift 3pm - 11pm)
Permanent · Columbus
BATH & BODY WORKS
sr. Manager, Carrier Strategy
Permanent · Columbus
VICTORIA'S SECRET
Brand Operations Manager-Crystal Mall
Permanent · Waterford
L BRANDS
Asset Protection Officer, Morse Crossing - 3rd Shift (11pm-7am)
Permanent · Columbus
VICTORIA'S SECRET
Brand Operations Manager-Coconut Point
Permanent · Estero
BATH & BODY WORKS
District Manager - Bath & Body Works - North Austin - Austin, tx
Permanent · Waco
VICTORIA'S SECRET
Brand Operations Manager-Valley West
Permanent · West Des Moines
L BRANDS
Asset Protection Officer, Broad st -1st Shift 7am-3pm
Permanent · Reynoldsburg
L BRANDS
Asset Protection Officer, New York City
Permanent · New York
BATH & BODY WORKS
Senior HR Generalist - Home Office
Permanent · Reynoldsburg
VICTORIA'S SECRET
Brand Operations Manager-White Marsh
Permanent · Baltimore
VICTORIA'S SECRET
Asset Protection Investigator, Victoria's Secret (Southland Mall - Hayward, ca)
Permanent · Sacramento
PINK
Brand Operations Manager-Solano
Permanent · Fairfield
VICTORIA'S SECRET
Product Owner
Permanent · Reynoldsburg
ESTÉE LAUDER COMPANIES
Manager, Creative Operations, Creative Content Hub, North America
Permanent · New York
ESTÉE LAUDER
Director, Ecommerce, North America - dr.Jart+
Permanent · New York
JCPENNEY
Product Manager - Site Management Tools & Cms
Permanent · Plano
JCPENNEY
Financial Planning Senior Analyst - Stores Finance
Permanent · Plano
Published
Dec 19, 2017
Reading time
3 minutes
Share
Download
Download the article
Print
Click here to print
Text size
aA+ aA-

Koovs gets first-half boost but still makes loss, shares plunge

Published
Dec 19, 2017

Koovs turned in an improved set of results for the six months to September 30 as it sold more product at full price and boosted brand awareness. 


Koovs


But the UK-based company, which targets the Indian young fashion market, is still lossmaking and meaningful sales growth remains hard to come by in a market hit by the ongoing effects of India’s currency revolution. The policy known as demonetisation did not achieve the government’s aims, but it did hit Indian retailers hard. The tough environment meant Koovs warned that the year as a whole will be challenging and its share plunged on Tuesday as a result.

So what exactly happened to Koovs in the first half? Well, the bad news is that gross sales were merely flat at £7.9 million. They were "in line with India's e-commerce market, impacted by demonetisation, the introduction of the Goods and Services Tax, and heavy discounting and marketing expenditure by sector peers.” 

Visits to the firm’s website fell 15%, so it’s no surprise that also in the bad news column, group revenues were down to £3.9 million from £4 million, even if active customer numbers rose 4%. And the company made a pre-tax loss, albeit a 15% lower one of £7.8 million compared to £9.1 million a year ago.

Any good news? Well, the group gross margin improved from a worrying -20% to 0%, and the quality of sales improved with markdown sales cut to 20% of the total from 29% a year earlier. That was achieved despite the market being driven by high discounting and it helped the trading margin increase significantly to 18% from 2%.

The company also said that Average Order Value increased by 21% to £17 from £14.70, and brand awareness rose to 21% from 15% in March. And its operating costs were down by 9% to £7.7m.

Other bright spots included new international distribution agreements with Souq.com in the Middle East and Simply Be in the UK. Meanwhile a recent Forrester survey for customer experience ranked it number one among e-tailers in India. Its social media presence also grew by 29% to 2.2 million followers and funding of £8.9m was received in the period through the issuance of 6% convertible loan notes.

FUNDING

That last point is crucial as it means that, with Koovs still clearly a work-in-progress, it has the capital to invest and continue to expand. It’s still aiming to raise more funds (around £10 million) with a capital-raising programme that was announced in July expected to close shortly.

The importance of those funds are obvious as the performance in the second half so far proves. Koovs said that “with modest additional marketing spend, the important month of November delivered a significant year-on-year improvement across key metrics, with sales up by 17% to £1.7m and website traffic up 43%.”


Koovs


However, it also said that marketing expenditure is currently significantly down due to its ongoing funding requirements and the company expects this to affect the year’s sales overall. Additional marketing expenditure “is conditional upon the timing of closure of that new funding programme.”

But even without the funding issues, Koovs said it remains “well-placed to maximise the future growth of the Indian e-commerce market and expects the market to return to growth in the next financial year.”

CEO Mary Turner said she was pleased with the progress so far, despite the fact that it “has been a challenging year generally for the market” and is upbeat for the future.

And there’s no denying that the market opportunity is huge. The massive Indian e-tail sector is predicted to grow fivefold to $3.5 billion in the next few years as the effects of demonetisation and the Goods and Services Tax fade.

Copyright © 2021 FashionNetwork.com All rights reserved.