Jewellery retailer Lovisa (ASX: LOV) is glistening at the moment with not just phenomenal growth for its online sales in the first 16 weeks of FY21, but also a significant improvement for its bricks-and-mortar stores globally.
Even though 30 stores in metropolitan Melbourne remain closed with a potential re-opening on the cards for 1 November, global comparable store sales were down just 10.2 per cent in the financial year to date.
This compares to a 32.5 per cent year-on-year decline in the June quarter.
"We have continued to see stronger performance from those markets that have been re-opened longest and with the least restrictions in place, with Australia and New Zealand continuing to be our best performing regions," the group reported in an update today.
"We have seen a large increase in COVID cases across a number of our markets over the past few weeks, in particular in Europe, and continue to monitor these situations, however at the current time all of our European stores remain open."
But the company has also been ringing the figurative online till at an unprecedented rate. Lovisa's e-commerce sales growth stood at 384 per cent in the June quarter, but now that rate has edged even higher to 400 per cent.
"Our execution online remains a key focus to ensure it can become a meaningful part of our business, with digital store fronts now in place servicing all 8 of our major markets around the world," Lovisa said.
However, the improved performance in Australia both for stores and online has meant the company is no longer eligible for the JobKeeper wage subsidy past the end of September.
The expected impact of this development on profitability is likely what pushed LOV shares down 1.15 per cent today to $8.60, but they are still more than three times higher than their lowest price when the pandemic hit.
"Our Global Support Centre and our Australian Distribution Centre are both located in Melbourne and both have continued to function well during the government-imposed lockdown in supporting our global business operations," the group clarified.
"Our strategic plans remain in place, we are ready to continue our store roll out and we continue discussions with our landlords globally as we believe current circumstances will create further opportunities for expansion of our store network, which will be supported by our strong balance sheet with a continued net cash position and undrawn cash debt facilities available to support our ongoing investment in growth."
Updated at 3:55pm AEDT on 20 October 2020.
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