Shares in online retailer Kogan (ASX:KGN) jumped more than 13% at one stage yesterday after it revealed the resumption of a final dividend for the first time in several years.
The 7.5 cents per share dividend took investors by surprise, as Kogan had only resumed paying dividends earlier this year for the first half of the June 30 fiscal year.
That 7.5 cents per share payment was the first after a three-year pause during the pandemic, and there was no indication that the company would match that with a final dividend.
"Reflecting the strength of Kogan.com’s financial performance in FY24 and a strong balance sheet, the Company’s Board of Directors has reinstated a dividend for FY24, declaring a fully franked Final Dividend of 7.5 cents per Ordinary Share,” the company said on Monday.
"Together with the Interim FY24 dividend, the Directors have declared a total fully franked dividend for FY24 of 15.0 cents per Ordinary Share (FY23: nil),” the directors added.
However, the price surge doesn't seem to have been due solely to the resumption of dividends. The company's financials also showed an improvement in its inventories, a perennial problem. At $73 million, stock was still $5 million above last year, but that was after a concentrated effort to reduce levels throughout the year.
Gross profits were up due to the higher contribution of platform-based sales, which accounted for 62% of revenues for the year, compared to 57% last year. In Kogan's products segment, gross profits rose 40% year over year to $39 million. The company reported $41.2 million in cash on hand and no debt as of June 30.
Additionally, the company stated that trading in the first seven weeks of 2024-25 had seen higher sales, revenue, and profits compared with the same period of 2023-24.
Kogan reported that Gross Sales were up 2.1% year on year to $63.9 million; revenue was up 15.6% to $40.3 million; Gross Profit was up 23.0% to $15.6 million; Adjusted EBITDA was up 53.4% to $5.3 million; and Adjusted EBIT was up 88.9% year on year to $4.0 million.
This follows a solid improvement reported for the year to June 30, when revenue fell 6.1% year over year to $459.7 million, but gross profit surged 23.3% to $168.4 million. Adjusted earnings before tax jumped to $40.0 million, up from $6.8 million in FY23, and the company’s statutory net profit hit $100,000—a modest amount, but a significant rebound from the $25.9 million loss recorded in 2022-23.
CEO Ruslan Kogan said in the release that 2023-24 "was a milestone year for Kogan.com. Our business returned to a position of profitability and strength, having navigated through the previous two and a half years of turbulence.
"We achieved this by restructuring and improving our operations, focusing on growing the right areas of our business, rapidly increasing platform-based sales, and, most importantly, investing in our loyal customer base. This has helped put Kogan.com in its strongest position ever."
