Sosandar Plc

hello everyone so just to take you through the agenda for today firstly we're going to take you through an overview then stevie's going to talk about the financial and kpi review julie and i will go through product followed by some more detail on third parties then we'll touch on marketing followed by esg and lastly the outlook for susanda so just to give you an overview of the susanda story so far so the success of susanda was spotting the opportunity for an e-commerce brand for women who had graduated from fast fashion What they were looking for was a trend-led brand. We design all our clothes in-house, looking for high quality, good fit and lifestyle appropriate. So our customers tend to be in the 35 plus age bracket. She was also looking for a mid price point. So on average, a dress at Susanda would be about £69. So in simple terms, before Susanda, our customer was either faced with brands that were too young for her or brands that were too safe and not fashionable enough. So what we gave her was a unique aesthetic, a chic and sexy look, both in terms of the style of the product we produce and everything we do marketing wise. So all the imagery and the aesthetic behind the lifestyle we sell. So we launched in September 2016 with 74 styles. That has increased 30 fold and we now have a product range of 2000 styles on the site. As you can see on the chart, we've gone from startup to 12 million turnover in four years. And the success of the brand and unique brand positioning has been recognized by many third parties who all approached us. And the ones we chose to work with so far are Next, M&S and John Lewis.

So just to give you some highlights from the full year, and then I'll give highlights of current trading. And we're going to go into more detail in all these areas later on in the presentation. So revenue for the year is 12.2 million, which grew 35% on the prior year. And the really key part is that we saw a 62% improvement in our EBITDA loss. We maintained our cash balance incredibly well, finishing the year at 3.93 million with very minimal cash burn throughout the previous year. And that's really been partly due to scale and also the maximizing of return on investment from customer acquisition. we really accelerated the expansion of the product range to really adapt to customers changing needs and we recruited more customers last year than we did the prior year but on half the marketing spend so we'll come on to talk about how we did that later on we're also seeing once we recruit those customers customers are incredibly sticky so we're seeing ever increasing number of repeat customers And we're also seeing those customers order more frequently. And as Ali said, we have launched very successfully with John Lewis, Next and Marks and Spencers with those orders being profitable from day one. And highlights of current trading. So the new financial year began in April. So for the first quarter of the new financial year, we've had a really great start. It's been a record quarter. Each month has increased sequentially, ending with a record in the month of June. So total revenue for the quarter is 5.7 million, which is up 256% versus the prior year. Obviously worth pointing out that, of course, we were in heavy lockdown at this point last year. importantly we're also up significantly on where we ended the prior financial year so versus q4 this first quarter the new financial year is up 45 we've seen a really strong increase in active customers increasing by 23 in three months alone and we've seen the fastest sell-through of new stock that we've ever seen and the third parties just continue to go from strength to strength And the EBITDA improvement also continues and we can see a very clear path to profitability.

Moving on to the financial and KPI review in more detail. Starting with a P&L overview, which just shows the 62% reduction in EBITDA losses to 2.9 million in the year ending March, driven by the 35% increase in revenue to 12.2 million. Gross profit percentage in the year was 48%, which maintained broadly stable against the prior year. And that was despite a slightly higher impact of promotional activity during the year in order to ensure sell through a product through the pandemic. Quarter one, the gross profit margin for the new financial year was 56%, showing a step up as the restrictions started to lift. We also saw a substantial reduction in admin expenses by 26% within the year. predominantly driven by marketing and economies of scale as the focus on return on investment and cash preservation and management took hold through the year. In terms of balance sheet, as Julie mentioned, a really strong cash position at the end of the year of 3.9 million, held broadly stable since nine months previous where we had 4.4 in July, a really strong position. The other thing to note on the balance sheet is that of inventory, which was reduced significantly by a million to 2.9 million. And that's despite increasing the range of product that we now stock, as well as onboarding the third parties during the year. Our balance sheet was further strengthened in May of this year, following a fundraise where we raised 5.4 million net. And that raise is designed to accelerate our growth beyond where we're already heading, particularly with our third parties, by increasing our stock holding from autumn-winter of 21 to ensure that we increase the amount of breadth of range that's stocked on our third parties, so the number of styles, but also the depth of each style, so the quantity against each style, so that we can really maximise the opportunity that's being created by our relationships. At the end of June, we were holding cash of 9.1 million inclusive of the raise, which again is minimal operational cash usage in that period. Moving on to some of our broader KPIs, starting with the total number of orders. And what we're looking at here is how our orders have changed over the last two year period. Last year, the total orders that we generated grew by 29% year on year. As we entered the autumn, so September 20, we returned to customer acquisition, and you can see the number of orders growing from that period onwards. It's that customer acquisition that has also enabled us to grow in the first quarter of this current financial year, with total orders tripling against the same period 12 months previous. And in this first quarter of the new year, our total orders are 40% up when compared with the previous final quarter of the last financial year. And that's driven both by new orders as well as those that are from repeat customers. And looking at our existing database, our active customers and how engaged they are, this chart shows us how engaged and the average order frequency that we're generating from our active customers. So today, based on quarter one, 42% of our active customers are now purchasing from us more than once per annum. And that's up 26% on the previous year. In addition, as Julie mentioned, we've increased the number of active customers in the last three months alone by 23 percent and now have 167,000 customers buying from us in the last 12 months alone. In addition, on average, each customer is now buying from us 2.2 times per annum. And if we look at only the cohort of customers that purchased from us more than once in the last 12 months, that's now nearly four times per annum, which is up from three times only 12 months previously. In terms of our conversion, which we've seen a really significant increase over the last six or nine months. So our conversion stepped up significantly in the second half of last year. And again, in the first quarter of the new financial year, we're now tracking at around 3.7 percent conversion. This has been driven by the expansion in our product range and also the refinement of our marketing mix and our strategy, which we'll talk about later in the presentation. With regards to average order value, that stepped up again in quarter one, following the dip that we saw last year as the maturity of the product mix took hold. It stepped up in Q1 to £86 as we started to see the product mix normalise as dresses, both woven and jersey, took a slightly larger proportion of the overall mix. In terms of our admin expenses, on the left hand side, we can see the absolute spend of our costs. But on the right hand side, which is what I wanted to focus on, you can see those costs as a percentage of our revenue, which, as we entered last financial year, dropped significantly. In the first half, as we stopped customer acquisition, as we got to grips with the pandemic, but much more significantly, as we started to acquire more customers and invest in marketing again in the second half of last year and continuing into the first quarter of the new financial year, Our cost as a percentage of revenue dropped significantly in the first half of the last financial year as we focused on preserving cash and stocked customer acquisition for that period of time. As we entered the second half of the last financial year, we recommenced with our activities, but importantly, our cost as a percentage of our revenue have continued to stabilise and actually fall as we've entered into the first quarter of the new financial year. showing quite clearly the economies of scale that we're now generating, along with the ROI improvement from marketing, which really shows the clear path that we now have to profitability.