Sosandar Share Discussion Threads

[someuwin] 12/4/2023 12:32

The key line in today's statement is this one...

"In addition, Sosandar is in active dialogue with a number of potential international third-party partners and expects to be able to provide an update on this in the coming months."

i.e Multiple overseas third parties lining up to stock Sosandar products. This has the potential to add huge additional growth to the business - none of which is currently factored in.

[raleigh43] 12/4/2023 12:27

Excellent analysis.

[someuwin] 12/4/2023 11:51

From Singer note:

Sosandar (SOS LN)Corporate

Positive exit rate into FY24 and accelerating growth
The full year update signals positive sales/margin trends continued in Q4. With a step-change in resource/capability to expand overseas accommodated within forecasts, the medium to long term potential has increased. Having raised £5.5m in Feb at 22p, SOS is now very well-placed to deliver a step-change in scale and profitability by accelerating multi-channel distribution and other growth plans, including customer acquisition where LTVs are compelling. We see a big opportunity in Mar’25 in particular vs. the prudent forecasts (2-yr EPS CAGR >50%) we have introduced today and have edged our target price up accordingly, now to 48p. Buy.

Fast growing brand with significant growth opportunities
Sosandar is one of the fastest growing listed retailers in the UK. It is a differentiated women’s fashion brand focused on 35-65 year olds, and has a clear growth strategy in a large and under-served market where its share is still only 0.2%. Execution has been impeccable in the last 2 years, despite exceptional external challenges. It successfully moved to profit over a year ago and, after a good Q4 to Mar’23, EBITDA margin has continued to expand. These benefits from economies of scale are ongoing.

Accelerating growth – via 3rd party expansion and customer recruitment
The £5.5m placing proceeds raised after signing a new wholesale agreement with Sainsbury’s in Jan’23 will accelerate growth by 1) fast-tracking its strategy into multi-channel distribution with that exciting new partner, 2) fast-tracking other growth plans, including more 3P partnerships both in the UK and overseas, and 3) accelerating customer recruitment to its own site, where its proven range, marketing and retention dynamics deliver highly compelling lifetime value metrics.

Prudent forecast changes with scope for more on full deployment
Q4 trading was in line with expectations except for certain investment being accelerated in operations, technology and international. While Mar’23 PBT is c£0.25m lower than we forecast, the investment will facilitate growth and drive value creation; SOS is already in dialogue with several international 3P partners. Based on prudent assumptions in relation to deployment of the proceeds, financial benefits and placing dilution, we forecast 2-year sales/EPS CAGRs of 28%/53%. This includes a step-change in resource/capability for international expansion and leaves risk potentially to the upside, especially in Mar’25. As stated before, we believe EBITDA margins can expand to >10% in time (vs FY’25E 6.9%).

Valuation consideration
SOS trades on 14x EV/EBITDA to Mar’24, falling to 9x (14x P/E, <0.7x EV/sales) in Mar’25. The PEG is <0.4. It passed the inflection point to profitability over 18 months ago, and has a pipeline of very exciting growth plans. We therefore use a blend of metrics to derive our 12-month target price (1x PEG, 17.5x EV/EBITDA, 1.5x EV/sales). While our target price only edges up to 48p for now, it offers a 100% TSR and should advance if/when proceeds are more fully deployed into incremental 3P agreements. New 3P announcements in the coming months should therefore act as a catalyst. Buy.

[montynj] 12/4/2023 11:15

Where does he write

[johnwise] 12/4/2023 10:38

Sosandar swings to first ever profit as fashion group's average order value jumps to almost £100 a pop

Average order values at Sosandar increased by 8% to £97.27, the group said

Fashion retailer said its tie-ups with M&S and Next had been very popular

[daijavu] 12/4/2023 10:22

A positive write up from Paul Scott. He dismisses the shortfall as irrelevant, and in any case related to funding expansion plans. He's more interested in the plans for international development that, as he points out, put a rocket under ASOS's share price when it was announced early in ASOS's development.
I think we've got a lot to look forward to

[johnwise] 12/4/2023 10:14

12/04/2023 7:00am

RNS Number : 8884V

Sosandar PLC Trading Update & Progress on Growth Strategy

Trading with our now well-established third party partners, John Lewis, Marks and Spencer, Next, The Very Group and JD Williams, has been extremely strong,

[raleigh43] 12/4/2023 09:16

I think the international sales will blow those figures out of the water.

[aleman] 12/4/2023 09:12

I presume these numbers will be revised later:


January

Year Revenue PTP
2023 £43m £2.1m
2024 £58m £3.5m
2025 £74m £5.7m

Today

Year Revenue PTP
2023 £42.4m £1.9m
2024 £58.9m £3.5m
2025 £73.1m £5.0m
2026 ?

[bg23] 12/4/2023 09:03

Impressive stuff, exciting plans and very capable management.

£58m market cap at today's shareprice with consensus forecast of £58m turnover and £3.1m pbt.

seems very reasonable even without the developments in plan.

happy LTH and add.

[daijavu] 12/4/2023 08:16

A positive write up from Paul Scott. He dismisses the shortfall as irrelevant, and in any case related to funding expansion plans. He's more interested in the plans for international development that, as he points out, put a rocket under ASOS's share price when it was announced early in ASOS's development.
I think we've got a lot to look forward to

[faz] 12/4/2023 08:05

£300k PBT below 'market expectations' because of bringing forward plans and recruitment, and if the shares fall on that then goodbye to myopic investors. This company is on the cusp of a critical mass of sales which will create a momentum of its own. The staff are in place and the cash will fund inventory and international expansion. I exopect this company to do very well in the next year and am a longterm holder (and fulltime professional investor fwiw)

[daijavu] 12/4/2023 08:03

Not much of a reaction so far

[someuwin] 12/4/2023 07:13

-- Revenue of GBP42.5m, up 44% year-on-year (FY22: GBP29.5m)
-- First full year of profitability, delivering PBT of at least GBP1.6m, a substantial positive
swing of GBP2.2m vs GBP0.6m loss in FY22
-- Gross margin maintained at 56.1% (FY22: 56.0%) despite growth in revenue through lower margin
wholesale channel
-- Unique product continues to resonate with loyal customer base through Sosandar.com:
o Number of orders increased by 22% to 620,977 of which 148,382 were from brand new customers
and 472,595 were from existing customers
o Conversion rate increased to 4.1% from 3.9%
o Average order value up 8% to GBP97.27 (FY22: GBP90.39)
o Number of active customers increased 19% to 264,832
o Average order frequency increased 3% to 2.34 times per annum
-- Performance of third party partners continues to go from strength to strength, and successful
launch with Sainsbury's in Q4 FY23 with significant combined contribution expected in the
current financial year and beyond
-- Ongoing planned investment in inventory to facilitate further growth, following equity fundraise
in February 2023
-- Accelerated investment in strategic growth initiatives in the final quarter of FY23 to capture
further market share focused on:
o Operations - including key hires
o Technology platform
o International strategy
-- Net cash of GBP10.5m as at 31 March 2023 (GBP4.2m as at 30 September 2022), following the
successful equity fundraise of GBP5.5 million of net proceeds in February

[raleigh43] 11/4/2023 18:12

It’s coming and given the target audience, I think it will be good.

[jackson83] 11/4/2023 15:54

overvalued looking to add to my SHORT POSITION NOW



20p or lower


sales down in march RED FLAG




SELL sos

[aleman] 11/4/2023 10:19

Shipping rates fall below pre-Covid.

[daijavu] 11/4/2023 09:20

Just some small sells this morning.

[jackson83] 10/4/2023 16:44

wait for 20p to buy more .... recession looms / sales in decline for online stores as returns rise .... RED FLAGS soon

[raleigh43] 10/4/2023 12:14

This week?

[daijavu] 06/4/2023 14:03

Perhaps next Tuesday or Wednesday

[someuwin] 06/4/2023 07:14

...Not today then.

[jackson83] 05/4/2023 22:15

opportunity to sell folks ... market cap way to high.




20p soon