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Stockport-headquartered circular economy pioneer, musicMagpie, has seen its revenue from consumer tech grow 15.9% in the six months to 31st May, the business has revealed in its interim half-year results.
Refurbished consumer technology sales now account for 65% of the total revenue, and growth in this area has helped to offset a post-pandemic decline in sales of books, games and other media, which had been buoyed by lockdown restrictions. The businesses has recorded a gross profit of £19 million, on total revenue of £71.3 million.
Tech sales were boosted also by expanded online sales channels to Back Market, the re-opening of refurbished B and C grade products on Amazon Marketplace, and the continued roll-out of SMARTdrop kiosks in Asda stores across the UK. The business has also secured a £30 million revolving credit facility with HSBC UK and Natwest to drive future growth of its device rental service, revenues of which grew to £2.3 million in the first half of 2022.
Other operational highlights of the six months to 31st May include two C-suite appointments for the business: Chief Financial Officer Matthew Fowler; and Chief Development & Partnership Officer, Matt Harrison, who joins from Asda with responsibility for growing musicMagpie’s ‘Magpie Circular’ offer for the corporate market.
Commenting on the results, Steve Oliver (pictured), Chief Executive Officer of musicMagpie, said:
“I am pleased that the business has delivered a strong performance in our strategically important Consumer Technology division, which now represents two-thirds of our total revenue.
“I am also delighted with the progress being made in our device rental subscription service. In light of the continuing squeeze on consumer spending, we believe that this will become an increasingly attractive option to a wider range of consumers seeking to replace their non-discretionary technology products in a cost-effective way. Whilst the successful growth of this offering has a short-term compression on the financial performance of the business relative to a one-off sale, it will deliver higher revenue and EBITDA over the life of the device. It therefore remains our overriding growth strategy for the medium term, and we are delighted to announce HSBC UK and Natwest’s support in the form of a new £30m three-year revolving credit facility to further support our investment in this area.
“Notwithstanding the challenges presented by the current macroeconomic uncertainty, we expect consumers will continue to seek ways to raise cash and save money and as a result, we are confident that the business is well positioned for future growth in H2 2022 and beyond.”