Online furniture brand Made.com has reported ‘volatile’ trading in recent months with the start of the year more ‘challenging than anticipated’.
According to its lates trading update, Made said that third-party data suggests that the online furniture and home market is down around 30-40% so far this year. Compared to the market, MADE gross sales were down only 10% in Q1 vs Q1 2021 (and up 64% vs 2019).
Made has also updated its expectations for the full year, stating that it assumes the market will ‘remain highly challenging for the rest of 2022 despite the significantly easier comps for H2’.
“We remain very confident that Made will continue to outperform the online home and furniture market by at least 20 percentage points,” the retailer said.
“Spot freight rates continue to normalise in line with previous expectations, but lower sales mean the benefit will be reflected in gross margin later in 2022 than previously anticipated. We still expect 2022 exit rate gross margin to be around pre-pandemic levels and business shape will be set for the new operating environment. These actions will position the business to deliver positive adjusted EBITDA and free cash flow in 2023.”
Made indicated that it expects total sales to be 15% down or to be flat on its previous year, while Adjusted EBITDA is expected to result between a loss of £35m or £15m, which includes one-time costs relating to supply chain disruption of £5m.
“With a much weaker market backdrop for 2022, we now expect to achieve £1.2b of gross sales later than 2025. The Board remains very confident in the long-term value drivers of the business,” Made added.
Nicola Thompson, Chief Executive Officer, continued: “There is no escaping the tough trading environment at the moment. However, we are laser-focused on executing our strategy and we are delivering strong progress across each of our strategic pillars.
“Our customers are at the heart of our business and we’re seeing a really positive reaction to our improved proposition, with average lead times consistently at the targeted 3-4 weeks average for the last two months. MADE continues to outperform the online furniture and home market and I am confident the company will emerge in a very strong position.”