MyDeal revenues jump as Woolworths deal looms

The company says it is performing well despite more difficult trading conditions as it finalises a $243m takeover deal with the supermarket giant signed earlier in the year.

Woolworths boss Brad Banducci announced plans to acquire MyDeal earlier this year. Picture: John Feder

Online retailing platform MyDeal says it recorded an 89 per cent jump in revenues in the three months to June 30, with customer numbers growing strongly despite subdued conditions.

The company – backed by Tony Gandel, the son of shopping centres billionaire John Gandel – is being sold to Woolworths, although the deal still requires competition regulator approval.

In an investor update, MyDeal said gross sales had hit $272.2m for the financial year to June 30, up 24.8 per cent on the prior year, while active customer numbers had risen 17.6 per cent to reach 1.05 million.

“MyDeal delivered another strong quarter … ahead of guidance despite a more challenging retail environment,” said the company’s chief executive, Sean Senvirtne.

“Our growth for the quarter of 27 per cent was driven by a combination of the key initiatives we have invested in over the past 12 months, including in-stock, brand refresh, personalisation and the continuing adoption of the MyDeal app.”

The company reported customer receipts of $62.4m for the quarter, up 25.9 per cent on the prior corresponding period, driven by increased sales.

MyDeal shares are trading at $1.03.

Woolworths’ takeover, valuing the company at $243m – or $1.05 per share – was announced in May. The company floated in 2020 at $1 per share.

Some analysts have questioned the deal’s rationale, highlighting Woolworths poor track record in non-food and asked if the takeover is an admission by the supermarket giant that its own online marketplace venture is not gaining traction.

MyDeal.com.au also made a loss last financial year of $5.8m and this was through the peak of lockdowns. “We can’t help but think if it didn’t make money through the Covid period will it ever,” said Barrenjoey analyst Tom Kierath in a note in May.

MyDeal.com.au, which specialises in general merchandise such as furnishings, outdoor furniture and garden goods, was established in 2011 and has grown to be one of Australia’s leading online marketplaces. The platform presently hosts approximately 1,900 sellers offering more than 6m product stock keeping units and has more than one million active customers.