The Cettire Ltd (ASX: CTT) share price is roaring higher on Wednesday morning.
In early trade, the online luxury products retailer's shares are up 40% to $4.43.
Investors have been buying the company's shares after it reported rapid, profitable growth during the first half of FY 2024.
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Cettire share price jumps on half-year results
- Gross revenue up 90% to $460.5 million
- Sales revenue up 89% to $354.3 million
- Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) up 56% to $26.1 million
- Adjusted net profit after tax of $16.4 million
- Net cash balance of $100 million
What happened during the half?
For the six months ended 31 December, Cettire reported a 90% lift in gross revenue to $460.5 million.
This reflects higher repeat customers, a 4% lift in average order value, and an 83% increase in active customers to 576,000. In respect to the former, approximately 58% of gross revenue is now attributable to repeat customers. This is up from 56% a year earlier.
A key driver of this growth was Cettire's decision to increase its paid acquisition investment to 8.9% of sales revenue from 7.9% a year earlier.
And while the company's delivered margin increased by 75% to $82.2 million, unfavourable currency movements meant that it experienced a year-on-year increase in fulfilment costs as a proportion of sales revenue.
This ultimately led to Cettire's earnings not growing as quickly as its sales. Nevertheless, its EBITDA was still up an impressive 56% to $26.1 million for the half.
Management commentary
Cettire's founder and CEO, Dean Mintz, was very pleased with the half. He said:
Cettire delivered an exceptional result for H1-FY24. During the period, we experienced broad-based momentum across both Established and Emerging Markets, supported by our localisation initiatives and marketing execution.
I believe this is our strongest trading half since Cettire went public several years ago and further demonstrates the uniqueness of our business model, the benefits of our proprietary technology platform and the strength of our execution. Our proposition is clearly resonating with both the demand and supply side of our platform as we continue to rapidly penetrate the global personal luxury goods market.
Mintz also hinted that the company could soon put its $100 million net cash balance to work. He adds:
Due to the sustained profitability and build up in cash balance, the Company has the flexibility to capitalise on growth opportunities and explore capital management initiatives.
Outlook
While no guidance has been provided by the company, it has reported a strong start to the second half. This could be giving the Cettire share price an added boost today.
Management revealed that January gross revenue increased approximately 80% versus the prior corresponding period and that "adjusted EBITDA profitability has been maintained."
The Cettire share price is now up 160% over the last 12 months.
