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Science in Sport has issued an update on trading for the current financial year, reporting continued momentum in its online business and ‘substantial’ improvements in gross margin.
Online channels continue to perform ‘very strongly’, it said, and this has offset some of the downturn caused in the retail channels by the COVID-19 pandemic. Total online revenues are ahead 39% year-on-year at £23 million to the end of November, and online sales are expected to grow to approximately 51% of total revenue for the full year, compared with 38% in 2019.
Group gross margin for the year is forecast to be up by four percentage points to approximately 48%, and gross margin to date for the second half is up a further two percentage points to 50%. The improvement is driven by online pricing and promotion strategy, the business said, together with strategic supply chain initiatives flowing through in the second half of the year.
Given strong momentum in online channels and some recovery in retail following the downturn in April and May, Science in Sport said it expects group revenue for 2020 to be in the region of £49.8 million.
“I am pleased to announce the business is performing well,” said Stephen Moon, Science in Sport’s chief executive officer. “We bounced back strongly following our decisive actions in March and April to restructure the business and strengthen the balance sheet. Our focus has been accelerating our long-term growth strategy and investing in our online business, and this has successfully delivered for us.
“We have invested in technology and talent to drive our online business across global territories for 2021 onwards, and we have continued to drive innovation and brand equity to underpin our premium margin business.
“A new supply chain unit is planned for late 2021. This will build further on the substantial progress made in gross margin during this year, and we expect to make progress throughout the strategic planning period. Whilst it is too early to reinstate guidance for the longer term, once the COVID-19 pandemic abates, we are well-positioned to take advantage of profitable growth opportunities in all major global regions.”
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