Shares plunge as Made.com hoists 'for sale' sign
By Abigail Townsend
Date: Friday 23 Sep 2022
(Sharecast News) - Shares in Made.com plunged on Friday, after the beleaguered online furniture retailer put itself up for sale in the face of sliding revenues and mounting costs.
The firm, which first warned on profits in July, had been considering raising fresh equity to help shore up the balance sheet.
But on Friday it confirmed that plans had been dropped, as "prevailing conditions were not supportive at the current time", and that it would now launch a strategic review instead.
Options under consideration include debt financing, investment from a partner or selling either assets or the group as a whole.
Made, which only debuted on the London market 15 months ago, also said it would cut costs and was reviewing headcount.
The retailer has been rocked by a slide in discretionary spending on the back of steep inflation and weakening consumer confidence. As well as hitting sales, it also forced Made to sell more goods at a discount, to clear down inventories.
Supply chain disruption also continued to weigh heavily, including ongoing delays and higher freight costs, which surged to £45.3m last year from £8.2m a year previously.
"This cost inflation in Made's supply chain has persisted throughout the first half of 2022 as a result of now structurally higher levels of freight rates and carrier costs," Made noted. The retailer also withdrew its full-year guidance.
As at 0930 BST shares in Made were down 31% at 3.96p. The stock, which debuted at 200p in June 2021, has lost 97% of its value in the year so far.
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