Redbubble – the online custom art printing business founded ten years ago by three mates in Melbourne – has seen its 2015/16 sales reach $114m, a stellar 61 per cent growth over the previous year.
Gross profit for the year rose by 61.8 per cent to $39m, while EDBITDA showed an $8.7m loss, which was $1.5m better than expected. This excluded the $2m it cost Redbubble to prepare for its IPO earlier this year, which was oversubscribed and valued the company at some $300m.
Martin Hosking, CEO of Redbubble says, “The strong result reflects the solid dynamics of the Redbubble business. Strong revenue growth, improved margins and lower operating costs resulted in an EBITDA loss $1.5m better than forecast.
“Overall the business is scaling well with revenue growth ahead of operating expenditure growth, and with stable margins and low customer acquisition costs.
“Based on the results and the upcoming pipeline of initiatives we are affirming our 2017 forecast provided at the time of the IPO.”
The market was not too impressed with the figures, its shares – which have been trending steadliy south since the IPO in June – dropped by 5 per cent on the release of the results.
Hoskings revealed site visits were up by 43.4 per cent to 148 million, conversion rate was up by seven per cent to 1.87 per cent, and that unique customers were up by more than 50 per cent to 2,200,000.
He attributed the EBITDA loss to higher operating costs – up by 57 per cent to $42m – accrued in the company’s aggressive expansion, which included the launch of French and German language websites, the addition of a further 50 staff taking the total to 180 and various software and fulfilment deveelopments..
Redbubble’s business concept is simple, it provides an online platform for artists to upload designs, site visitors can then look at those designs and choose to have them printed on a wide range of product, from apparel to homewares to promotional products. It does not have its own print facility, rather it uses 12 print partners in 18 locations around the world.
Hosking says that as Redbubble operate so a global scale it is immune from short term downturns n any economy, and says it is not restricted by physical borders of a typical printer. Its customers are spread across the world.
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