Temple & Webster buoyed by savvy younger buyers

Online homewares and furniture retailer Temple & Webster has seen sales lift 50 per cent for the first half of fiscal 2020.

Young first-home buyers are flocking to online retailer Temple & Webster.

Furniture and homewares online retailer Temple & Webster will benefit from an emerging demographic and consumption trend that will see millennials buy their first properties and fill them with everything from couches to mattresses, underpinning demand for decades to come, according to the retailer’s chief executive and co-founder, Mark Coulter.

Unveiling the company’s unaudited accounts for the first half of the 2020 fiscal year, which revealed a 50 per cent lift in sales for the period and which pushed into January where revenue bolted more than 50 per cent, Mr Coulter said Temple & Webster was in the best position to win from consumers shifting furniture purchases to online.

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And he added that it was just the beginning as a growing army of younger shoppers began dipping their toes into the housing market for the first time and were accustomed to visiting a website rather than a bricks-and-mortar furniture store.

“They are buying a home or moving into their second homes, having a family and just growing up and that is happening irrespective of macro factors and that is the generation that has grown up buying everything online and naturally when they become furniture buyers they are more open to buying furniture online,” Mr Coulter told The Australian.

“And our view is that will provide growth for our market, the online market, for decades.”

Temple & Webster will issue its full audited accounts later this month, but the trading update revealed continued sales strength into January despite economic headwinds and the bushfires and helped the company’s stock price rise almost 25 per cent.

It later closed up 66c, or 23.32 per cent, at $3.49 and has more than tripled in the past year as investors jump aboard the retailer, which had a horror IPO four years ago that saw its newly quoted shares immediately collapse to under 20c to hand it the wooden spoon as the worst performing float of 2016.

The first-half trading update reported that revenue rose 50 per cent to $74.1m as EBITDA of $2.3m was up from $1m in the prior corresponding period.

RBC Capital Markets analyst Tim Piper said Temple & Webster had unveiled an impressive result given the underlying category and the retail environment having been patchy. Customer growth was particularly impressive, with active customers growing at 45 per cent year on year to about 335,000.