Being a ‘romantic’ at heart, I’m planning to splash out this Xmas on a brand new fridge freezer for my long-suffering wife.
Albeit, rather than nipping down Curry’s, we intend this time to order the ‘gift’ online & get it installed by trained fitters, who will also take way the old broken device. All within 24 hours.
Marks Electrical (MRK ) – a rapidly expanding, internet retailer of household appliances that IPO’d 2 weeks’ ago raising £30m at 110p – does all this. Which when combined with best-in-class supply chain & marketing technology, alongside increased capacity, brand recognition & advertising spend – helped drive LFL sales up 78% to £37.5m in H1’22, & industry leading EBITDA margins of 8.1%.
Moreover October was a record month, with strong follow-through into November & good product availability heading into the important festive period.
But this is only the tip.
CEO, Founder & born entrepreneur Mark Smithson wants to ultimately lift MRK’s share of the £5.3bn UK market from 1.5% today to 10%. Which theoretically - assuming a 9% EBITDA margin and a 15x multiple - would generate a £675m valuation, or 640p/share vs 115p today.
Plus, even if one only factored in a modest 3.8% share (ie revs £200m), then this would still produce a 250p+/share figure.
Mr Smithson adding:”We believe that with our 1.5% share in H1’22, we are simply scratching-the-surface and that we have a huge opportunity ahead of us. By further improving our brand awareness and allowing more customers to experience the differentiated, superior customer service we offer.”
