Sosandar Reaches Inflection Point Back to Growth
Why we think this is good
Sosandar has delivered a substantial positive swing in profitability, with PBT expected to be not less than £0.5m compared to a loss of £0.3m in the prior year. This indicates the company's strategy of prioritizing margin enhancement over volume growth through price promotions is paying off. While revenue declined year-on-year, the company is now at an 'inflection point back to topline growth', with March and April trading showing positive momentum. The company also has a strong net cash position, suggesting a healthy cash runway to fund growth initiatives such as the roll-out of own stores. Overall, the results demonstrate solid strategic progress, with the business now positioned for sustainable, profitable and cash-generative growth.
Key Points
- PBT expected to be not less than £0.5m, a substantial positive swing from a £0.3m loss in the prior year
- Revenue of £37.2m, down from £46.3m in the prior year, reflecting the continued transition away from price promotional activity
- Improved gross margin of 62.5%, up from 57.6% in the prior year
- Strong net cash of £7.1m after £1.2m of capital expenditure for the roll-out of own stores
- Opened first six stores in FY25 as the company transitioned to becoming a full-price multi-channel retailer
- April trading has been strong, ahead of the prior year, building on the momentum seen in March
Summary
Sosandar plc (AIM: SOS), the women's fashion brand, has delivered a year of strong strategic progress, with a positive year-on-year swing in margin and profit before tax (PBT). The company's PBT for the full year is expected to be not less than £0.5m, compared to a loss of £0.3m in the prior year, representing a substantial positive swing. Revenue declined to £37.2m from £46.3m in the prior year, reflecting the company's continued transition away from price promotional activity and focus on margin enhancement. Gross margin improved to 62.5%, up from 57.6% in the prior year. The company also reported a strong net cash position of £7.1m, after £1.2m of capital expenditure for the roll-out of own stores. Sosandar has opened its first six stores in FY25 as part of its transition to becoming a full-price multi-channel retailer. The company is now at an 'inflection point back to topline growth', with March sales in line with the prior year and April trading to date ahead of the prior year, building on the momentum seen in March.