STP - Step One Clothing

[KW]

STP is a online only retailer that sells bamboo underwear, and I have it on good authority that they are great.  Started with mens underwear, but is now branching out to womens (womens is currently just 13% of revenue).  


It listed in late 2021, so has had a long road back post Covid, and it still isnt back to its IPO price.  But its fundamentals are strong.  

First Half results:
• Revenue of $45.1 million, representing a 25.5% increase vs pcp (1H23: $35.9 million)
• EBITDA of $10.1 million, up 35.6% vs pcp (1H23: $7.5 million)
• Gross margin remains at a strong level of 81.2%, up 0.5% vs pcp (1H23: 80.7%)
• Average order value (AOV3) increased by 4.7% to $94.47 (1H23: $90.26)
• Over 1,540,000 global customers, with 182,000 new customers added in 1H24 (1H23: 137,000
new customers added), 33% growth on pcp
• Strong financial position with closing cash of $43.9 million and no debt

P/E of 26 and a dividend yield of 4.1%.
• Interim dividend of 4 cents per share, fully franked
• Confidence in the business to distribute 100% of earnings and retain capacity to grow

Plenty of growth in this business to come - new geographies, women's collection, product extension, offline stores, etc.  It has all the hallmarks of being the next Lovisa (LOV). 

You cannot view this attachment.