The Noni B Limited (ASX: NBL) share price could be on the move on Thursday following the release of a trading update for the 12 months ended July 1.
In early trade the fashion retailer's shares are flat at $3.04 and have yet to add to their 12-month gain of 74%.
How did the company perform in FY 2018?
According to this morning's release, Noni B achieved total sales of $364 million in FY 2018, up almost 15% from FY 2017's sales of $316.8 million.
Key drivers of this growth were an impressive 4.5% rise in like-for-like sales during the period, the expansion of its store network from 614 to 641 stores, and a sizeable increase in online sales.
In respect to the latter, online sales now account for 5.8% ($21.1 million) of total sales compared to 3.6% ($11.4 million) in FY 2017.
As a result of this strong sales growth, Noni B expects earnings before interest, tax, depreciation and amortisation (EBITDA) for FY 2018 to be approximately $37 million.
This is consistent with broker expectations and represents growth of over 70% on the prior year's underlying EBITDA of $21.7 million.
What about FY 2019?
While management hasn't provided any guidance for FY 2019 yet, it has described the new financial year as a year of transformation for the company.
This is because it recently completed the acquisition of the Millers, Katies, Crossroads, Autograph and Rivers brands from Specialty Fashion Group Ltd (ASX: SFH).
Its focus is now on its implementation and integration plan, consistent with the approach taken by Noni B in prior acquisitions. Progress thus far has been pleasing according to management, and it remains confident that it will deliver on its targets.
Should you invest?
I think Noni B is one of the best small cap retailers on the Australian share market and well worth taking a closer look at.
It may not be as cheap as it was 12 months ago, but I still see a lot of value in its shares for those willing to make a patient buy and hold investment.
Elsewhere in the retail sector today the Lovisa Holdings Ltd (ASX: LOV) share price has tumbled 8% despite there being no news out of the company.
