Forecast merry Christmas fails to halt Kogan sell-off

Shares in online retailer Kogan.com fell almost 7 per cent on Tuesday despite CEO Ruslan Kogan’s upbeat assessment.

Shares in online retailer Kogan.com fell almost 7 per cent on Tuesday despite chief executive Ruslan Kogan’s upbeat assessment of the retailer’s outlook, ­including strong sales momentum heading into Christmas, at the annual general meeting.

Mr Kogan told shareholders at the meeting that trading last month had produced another strong set of sales and earnings growth numbers.

“Based on unaudited management accounts, we are happy to have delivered another month of strong year-on-year growth in gross sales and gross profit, while continuing our focus on running an efficient company with a low cost of doing business,” he said.

“Gross sales in October grew more than 18 per cent, gross profit grew more than 22 per cent and operating costs were lower this October than last October. Active customers grew more than 13 per cent year-on-year as at the end of October.”

Despite painting a rosy picture of the outlook and operational performance since July, shares in Kogan fell sharply to close down 50c, or 6.6 per cent, at $7.09.

“While the first four months of the financial year are exhibiting strong growth metrics, we know that the business end of the year is ahead of us with the Christmas trading period of November and December,’’ Mr Kogan said.

“These are usually the most important trading months of the year for us.”

The recently launched Kogan Marketplace was also proving popular with customers, he said.

“Kogan Marketplace was launched during the second half of fiscal 2019. Marketplace allows third-party sellers to offer their products for sale on the Kogan.com platform,” he said.

“The launch and growth of Kogan Marketplace enables us to boost competition on our platform, which results in lower prices and more choice for our customers.

“The rapid growth of Kogan Marketplace continued during the first quarter of fiscal 2020, where we achieved gross sales of around double the first full quarter of operations. October 2019 also saw another solid month from Kogan Marketplace, with $9m of gross sales delivered last month.”

Meanwhile, Greencape Capital disclosed on Tuesday that it had sold down its stake in Kogan.com to 6.65 per cent from 7.65 per cent, a reduction of about 900,000 shares.