Farfetch Limited said that gross merchandise value (GMV) increased by
273.4 million dollars to 739.9 million dollars in fourth quarter 2019,
representing year-over-year growth of 58.6 percent. Revenue increased by
186.7 million dollars to 382.2 million dollars, representing growth of 95.5
percent. Gross profit increased by 81.9 million dollars or 87 percent to
176.1 million dollars, while gross profit margin decreased 46.1 percent.
Adjusted EBITDA loss increased by 3.4 million dollars or 23 percent to 17.9
million dollars and adjusted EBITDA margin improved to negative 5.3
percent. Loss after tax increased by 100.2 million dollars or 1011 percent
to 110.1 million dollars.
Commenting on the financial update, José Neves, Farfetch Founder, CEO
and Co-Chair said in a statement: “2019 was a landmark year for Farfetch as
we grew our digital platform almost twice as fast as the online luxury
industry, and significantly improved our adjusted EBITDA margins as we
marched towards profitability. With more than two million active customers
and record GMV, Farfetch is firmly established as the largest global online
destination for in-season luxury.”
Highlights of Farfetch’s financial results
The company said, digital platform GMV increased by 166.4 million
dollars to 628.6 million dollars in fourth quarter 2019, representing a
growth of 36 percent. Excluding the impact of changes in foreign exchange
rates, digital platform GMV would have increased by approximately 37.2
percent. The overall turnover increase at Farfetch was primarily driven by
36.6 percent growth in digital platform services revenue to 226.4 million
dollars and the addition of brand platform revenue from New Guards.
In-store revenue increased by 126.9 percent to 9.8 million dollars due to
the addition of revenue from New Guards and Stadium Goods directly-operated
stores, as well as growth in Browns stores.
The increase in digital platform services revenue of 36.6 percent, the
company added, was driven by 36 percent growth in digital platform GMV.
Digital platform services revenue was also boosted by growth in first-party
GMV, which increased 55 percent and is included in digital platform
services revenue at 100 percent of the GMV, partially offset by a decline
in third-party take rate to 30.4 percent in fourth quarter 2019, from 31.9
percent in fourth quarter 2018.
“I am also extremely pleased with New Guards’ contribution towards our
business, which, just six months from the acquisition, is delivering
increased traffic to the marketplace, enhancing our brand position and is
accretive to our financials. On the enterprise side of our business, I am
ecstatic to have launched Harrods global e-commerce presence on our
platform. “In light of the evolving novel coronavirus situation, I am
pleased to see that from a trading perspective, there has not been a
material impact to the business. However, circumstances regarding the novel
coronavirus situation remain uncertain, and as such we are closely
monitoring the situation as it evolves,” added Neves.
Farfetch expects 40 to 45 percent GMV growth in 2020
While Farfetch said that in light of the heightened uncertainty recently
created by the spread of the novel coronavirus, for full year 2020, the
company expects GMV growth of 40 percent to 45 percent to 3 billion dollars
to 3.10 billion dollars, digital platform GMV growth of approximately 30
percent to 2.50 billion dollars to 2.56 billion dollars, brand platform GMV
of 470 million dollars to 510 million dollars, and adjusted EBITDA loss of
70 million dollars to 80 million dollars.
For first quarter of 2020, GMV growth is expected in the range of 44
percent to 51 percent, digital platform GMV growth of 20 percent to 22
percent, brand platform GMV of 100 million dollars to 120 million dollars
and adjusted EBITDA loss of 30 million dollars to 35 million dollars.
Picture credit:Farfetch
