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Kogan records 95% sales growth in Q4

Kogan.com has reported an increase of more than 95% in gross sales for the fourth quarter of FY20 compared to the previous corresponding period. Gross profit was up by more than 115% and adjusted EBITDA up more than 149%.

In June alone, gross sales exceeded $94 million, gross profit was more than $17 million and adjusted EBITDA was more than $7.9 million. This was ahead of the company’s performance in April and May.

Active customer numbers were 2.183 million at 30 June 2020 with an incremental 109,000 active customers in the month of June.

Kogan.com is celebrating four years since listing on the ASX. Founder and CEO, Ruslan Kogan said he is proud to have delivered four consecutive years of significant growth in sales and earnings.

“Our business is booming as more customers choose Kogan.com. We have been increasing competition for Australian consumers for 15 years – all our prices and specifications are publicly advertised every second of the day. Everyone is free to browse and compare, and shoppers choose us when we offer great value,” he said.

“As a result, more than two million customers have chosen to shop at Kogan.com in the last 12 months alone. We have also won the People’s Choice Award for Australia’s favourite online store for three years in a row.

“Our business has been obsessed with delivering value for our customers for 15 years and this is exactly what we will keep doing for the next 15 years and beyond.”

Kogan breaches Consumer Law by price gauging

In proceedings brought by the ACCC, the Federal Court has found online retailer Kogan Australia breached Australian Consumer Law making false and misleading representations about a tax time sales promotion.

Kogan ran the online promotion from June 27 to 30, 2018, advertising to consumers that they could use the code ‘TAXTIME’ to reduce prices by 10% at checkout. The promotion was advertised on the Kogan website, in emails sent to more than 10 million consumers and in SMS messages to more than 930,000 consumers.

Towards the end of the promotion, email advertisements such as: ‘48 hours left!’ and ‘Ends midnight tonight!’ were added to entice consumers to make a purchase during the sale.

The Court found the advertisements conveyed false or misleading representations because Kogan had increased the prices of more than 600 of its products immediately before the promotion. In most cases the prices of these products had been increased by at least 10% and the prices of these products were also reduced shortly after the promotion ended, many back to their pre-promotion prices.

“We brought this case because we were concerned that the advertised price reductions were not genuine savings,” ACCC chair Rod Sims said. “Many consumers who took up the offer on one or more of the 600 or so products in many cases actually paid the same as, or more than, what they would have paid immediately before and after the promotion.”

A hearing on relief, including penalties, will be held at a later date. The ACCC is seeking declarations, injunctions, pecuniary penalties, corrective notices and costs.

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