We have all seen a lot of the inside of our homes over the past two years: evenings slumped on the sofa in front of the TV after a day on a laptop in the kitchen.
But now the pandemic is over — according to the prime minister — other people are coming back into our homes. And we are realising that our sofas are holey, the rug looks like the dog’s duvet, and it’s time for a living room revamp.
That’s what makes Made.com’s shares worth a browse. The online furniture retailer (which has a few shops, too, including in London’s West End and Yorkshire) has been given a comprehensive kicking since listing at 200p a share last June. It is now trading at 68p, valuing the company at £265 million. Hopefully those investing in its furniture have had a comfier return in the past six months.
Founded in 2010 in Shoreditch, east London, Made.com was backed by Lastminute.com’s Brent Hoberman and made an immediate splash with its promise of cutting out the middlemen and working directly with designers.
It flourished during lockdown, when high street rivals were forced to shut their doors and half of Britain suddenly needed a desk. Some in the City reckon that Made.com’s June float saw it cashing in on a short-term pandemic premium.
It has certainly had a poor run of numbers since, including a December profits warning due to £45 million of orders being delayed by global shipping delays and container shortages.
Then, last week, its chief executive of five years, Philippe Chainieux, said he was leaving for family reasons, and the shares slumped a further 10 per cent to their current nadir.
Chief operating officer Nicola Thompson is taking the helm for now. She flourished as an Asos director and should help steer Made.com into more Britons’ homes — and Europeans’, too, who make up half of its sales.
Made.com has more than £100 million in cash and is savvy with marketing. It faltered mostly because of customers’ struggles to buy its stuff, but Asian supply blockages are easing and the brand is still held in high regard by millennials who are happy to buy their furniture without sitting on it first. They already make up almost 40 per cent of homeowners.
High employment rates should support consumer spending despite the cost-of-living squeeze. Made.com’s sales rose 38 per cent last year — the demand is there.
Solving supply issues will help get rid of the website’s disastrous “out of stock” warnings, and that will make it a stock to get into. Buy.
