Kogan sales, profits slide amid consumer slowdown

afr.com:

Kogan.com says its inventory has fallen nearly 60 per cent compared with a year ago, but its sales are down more than 22 per cent and profits fell in the second half as higher inflation and interest rates made consumers wary.

But the company’s chief executive, Ruslan Kogan, said underlying profitability was improving despite the more difficult trading conditions after the group reduced the amount of stock it held and began cutting costs.

Kogan.com founder and CEO Ruslan Kogan says the business is poised to “win” customers in tough economic environments. Eamon Gallagher

Kogan.com shares rose more than 8.5 per cent to $6.32 in early trade. The company has clawed back losses over the past 12 months but is still a fraction of its 2020 high of nearly $25 a share. The softer than expected June quarter inflation print on Wednesday – the headline number easing to 6 per cent lower than expectations – helped push the ASX 200 to a five-month-high.

The online retailer built up stock in its warehouses as a buffer against supply chain issues related to COVID-19 over the previous full year. The bet did not pay off and Kogan.com was caught with too much inventory. Its stock position was reduced by more than 57 per cent to $68.2 million as at June 30.

“It has been an important year for Kogan.com as we drove efficiency through our business,” Mr Kogan said. “Frugality, relentless pursuit of continuous improvement, data-driven decisions, and tough negotiations on behalf of our customers are all traits that are in our DNA. It’s what we do day in, day out.”

“We know millions of customers are struggling with cost of living pressures, and we’ve been able to recalibrate our business to better support them in these times.”

The company said gross