Marks Electrical has lowered its full-year profit guidance, despite a boost in sales after profit margins failed to lift amid the challenging trading environment.
Sales for the electrical retailer rose 22% to £88.9m in the nine months to December 31 thanks to a 17.8% surge in revenue to £35.1m over the golden quarter.
However, its gross product margin did not increase to the levels it expected over the quarter and “the impact of this in the peak trading period has had a material impact on our full-year profit guidance”.
As a result, Marks Electrical now expects full-year sales to be in the range of £115-118m and EBITDA in the range of £5-6m.
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Chief executive Mark Smithson said: “I continue to remain proud of the entire team at Marks Electrical for delivering a record peak trading period whilst gaining market share and maintaining our industry leading Trustpilot score of 4.8.
“This further demonstrates the strength and attractiveness of our market-leading customer offering and as brand awareness improves, we continue to see a strong repeat customer rate.
“Whilst I am personally frustrated about our expected margin progression in the second half, I remain confident about our long-term growth prospects and continue to be impressed by our ability to deliver market share gains profitably, against a fiercely competitive backdrop, whilst maintaining the highest levels of customer service standards in the industry.
“As we work tirelessly as a team to enhance our gross product margin in the remaining months of FY24 and into FY25, I also know from 37 years of trading that margin fluctuations are inevitable, they present us with an opportunity to learn, and will ultimately enable the group to deliver long-term value creation and position us as the UK’s leading premium electrical retailer.”
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