Online consumer goods retailer Kogan.com has more than quadrupled its annual profit following aggressive expansion of its profitable private label products.
Kogan.com's active customer numbers edged close to one million in 2016/17 - up 36 per cent on the prior year's numbers.
The growth comes after the retailer poured funds from its July, 2016 initial public offering into rapidly expanding its private labelled products - a range that now accounts for half of the group's gross profits, up from 37 per cent a year ago.
Kogan.com, which sells consumer electronics, general merchandise, food and travel deals, has benefitted from higher margins on its private labels, which include its eponymous brand and labels Ovela and bubbli.
The group's net profit of $3.7 million for the year to June 30, 2017, is more than quadruple of what it made a year ago after revenue jumped 37.1 per cent to $289.5 million.
Founder and CEO Ruslan Kogan says the result is testimony to how well the group has executed the expansion of its product range in both private labels and brands.
"As our customer base grows, it means that more products that didn't make sense (some years ago) start to make sense because we have a wider reach," Mr Kogan said.
He said the group was focused on growing its private label offering in its existing categories, which included the growth categories of beauty care, pet and sport accessories.
"The company has a strong balance sheet, which will allow us to continue to fund growth in our core Kogan retail businesses, while the continued diversification of our Kogan portfolio is providing strong cash flows," he said.
Kogan's revenue was up 20 per cent on the prospectus forecast and its $13.2 million in underlying pro-forma earnings (EBITDA), adjusted for one-off costs linked to the initial public offering, was more than triple the prior year's result.
Mr Kogan also reassured investors on Friday that his business would not suffer when Amazon rolls out its full online offering in Australia.
He maintained that Amazon would increase the uptake of online shopping and provide his business, which already trades on eBay, another possible platform.
Pleased investors drove Kogan.com's shares up 21 cents, or 8.8 per cent, to $2.61 on Friday, just shy of its all-time high of $2.60 on August 1 and well above the group's $1.80 initial public offer price.
KOGAN.COM PROFIT SOARS
* Net profit of $3.7m, up from $800,000
* Revenue up 37.1 pct to $289.5m
* Final dividend, fully franked, of 3.8 cents a share
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