NEW YORK (BRAIN) — Signa Sports United, the publicly traded parent of Wiggle CRC and other e-commerce sites, reported a net sales increase of 11% in its first quarter. But it says the increase would have been higher if not for the shortage of complete bikes available in the quarter.
How much higher? Well, subtracting SSU's complete bike business, sales were up 15% in the quarter.
The company began trading on the New York Stock Exchange in December. It also closed on the purchase of WiggleCRC the same month. WiggleCRC's business from Dec. 15, when it was acquired, until Dec. 31, the end of the fiscal quarter, are included in the numbers. The numbers do include sales by SSU's other bike e-commerce sites, which include bikester.com and Probikeshop.com.
The company said net revenue was €213 million ($236 million) in the quarter. In the last 12 months (LTM) ending with the quarter, sales were up 17% to 892 million euros. Excluding full-bike sales, net revenue grew 24% on an LTM basis.
The net loss was 165 million euros, versus a loss of 1 million euros in the first quarter last year.
Stephan Zoll, CEO of SSU, said, “This quarter we closed two strategically significant transactions, WiggleCRC and Tennis Express, that allow us to meaningfully enhance the strength of our platform. Despite the macro factors that continue to impact our results, we are focused on driving SSU to be in the strongest possible position to create value in the mid and long-term and we believe we are poised to do so upon the normalization of supply-chain disruptions.”
The company said supply chain disruptions affected all its business, but the most severe impacts were in the full-bike category.
Alex Johnstone, the company’s chief financial officer, said, “SSU’s results in the fiscal first quarter demonstrate the resiliency of the SSU platform; we drove consolidated topline growth by offsetting headwinds caused by supply constraints in the full-bike category with growth across all other categories. We leveraged promotional activity and targeted marketing investment to drive active customer growth and market share.”
On a call with investors, Johnstone said Wiggle was challenged in 2021 because of increased shipping costs that dampened overseas sales.
"Wiggle has a large international business, and due to some of the carriers surcharging (it was not) economic to ship some categories into Europe and into the U.S. and more broadly, Asia Pacific. So they've seen their international business come down pretty dramatically. And this has been a steady trend throughout the back half of last year. We do anticipate that when the carrier surcharging comes off ... that this will over time come down and international business will pick up."
On a pro forma basis, i.e. including the WiggleCRC and Tennis Express historic business for comparison, SSU's TTM revenues were 1.3 billion euros.
The company said that on a pro forma basis it will have negative organic growth in its first fiscal half because the sales are competing against strong pandemic-induced sales in the first half of 2021, and full-bike constraints will continue. It said it expects organic growth to resume in the third quarter.
