Temple & Webster share price on watch as sales surge 74%

The Temple & Webster Group Ltd (ASX: TPW) share price is on watch today after the online retailer delivered record full year results.

| More on:
living room with sofa, cushions and coffee table and decor items

Image source; Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Temple & Webster Group Ltd (ASX: TPW) share price is on watch today after the online retailer delivered record full year results. Consumers spending more time at home have increased spending on homewares while the coronavirus pandemic has prompted a shift to online shopping. These twin trends have benefitted Temple & Webster, driving sales to record levels.  

What does Temple & Webster do?

Temple & Webster is an online-only furniture and homewares retailer. Australia's largest e-commerce company in the furniture and homewares space, Temple & Webster sells more than 180,000 products from hundreds of suppliers. The company operates a drop-shipping model where products are sent directly to customers by suppliers. This reduces the need to hold inventory and complements a private label range sourced directly by Temple & Webster. 

How did Temple & Webster perform in FY20? 

Temple & Webster saw sales and revenue accelerate over the course of FY20. Full year revenue was $176.3 million, up 74% year on year. Second half revenue was up 96% on the prior corresponding period while Q4 revenue was up 130%. Active customers grew 77% year on year to reach 480,000 and the company had its first $2 million day in June. Full year EBITDA was $8.5 million, up from $1.5 million in FY19. This gave net profit after tax of $13.9 million, which included an income tax benefit of $5.9 million. 

CEO Mark Coulter said:

Our strategy of being a category specialist, with a clear customer offering built around the biggest and best range of furniture and homewares in the country, combined with the most inspirational content and services and a great delivery experience and customer service, is working. The advantages of being the online market leader are apparent as we continue to grow our market share. 

What is the outlook for Temple & Webster? 

FY21 has started strongly for Temple & Webster, which reached the 500,000 customer milestone in July. Revenue grew 161% year on year to 27 August, with trade ~160% up in both July and August. EBITDA for July and August is estimated to be ~$6 million. The mobile app has been launched in the app store and the company's second national television campaign will start at the end of Q1. The company had cash of $81 million and no debt as at 27 August, thanks to a recent $40 million placement. This leaves it well funded to pursue its growth objectives. 

The Temple & Webster share price was at $8.21 in close of trade on Friday.

Kate O'Brien has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia has recommended Temple & Webster Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

A male investor wearing a blue shirt looks off to the side with a miffed look on his face as the share price declines.
Share Fallers

Why Betmakers, Cettire, Johns Lyng, and Vulcan shares are falling today

These shares are having a tough session on Thursday. But why?

Read more »

A smiling miner wearing a high vis vest and yellow hardhat does the thumbs up in front of an open pit copper mine.
Broker Notes

Why Macquarie expects this ASX All Ords copper stock to soar 48% in a year

Macquarie forecasts another big year of gains ahead for this ASX All Ords copper stock. But why?

Read more »

Middle age caucasian man smiling confident drinking coffee at home.
Broker Notes

How much upside does Macquarie expect for Steadfast Group shares?

The broker has given its verdict on this blue chip.

Read more »

Female miner standing smiling in a mine.
Broker Notes

Why Macquarie predicts Pilbara Minerals shares could surge 71%

Macquarie forecasts a big rebound ahead for Pilbara Minerals shares. Let’s find out why.

Read more »

Businessman working and using Digital Tablet new business project finance investment at coffee cafe.
Share Market News

Down 90% from its 2021 peak, can IDP Education shares turn around?

Is this beaten down stock a buy? Let's find out.

Read more »

Contented looking man leans back in his chair at his desk and smiles.
Share Market News

5 things to watch on the ASX 200 on Thursday

Will the market continue to rise? Let's find out.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Broker Notes

The smartest Australian stocks to buy with $250 right now

$250 to invest? Check out these stocks that brokers rate as buys.

Read more »

Rising gold share price represented by a green arrow on piles of gold block.
Share Gainers

2 ASX All Ords stocks that would already have more than doubled your money this year

These ASX All Ords stocks have gained 126% and 145% year to date. But how?

Read more »