Pepperfry cuts losses by 32% in 2017-182 min read . Updated: 10 Oct 2018, 07:42 PM IST
The company plans to achieve overall profitability over the next 12-18 months
Bengaluru: Furniture retailer Pepperfry’s annual losses narrowed further to ₹ 169.26 crore, down 32% on a consolidated basis in 2017-18. Overall financial prudence, which led to a 13% reduction in expenses, a more omni-channel approach and an efficient supply chain network helped in cutting losses over time, the company said.
Consolidated revenue rose 20% to ₹ 308.46 crore during the year.
The company plans to achieve overall profitability over the next 12-18 months.
Pepperfry, run by Trendsutra Platform Services Pvt. Ltd, broadly expects a revenue growth of 40 to 70% in 2018-19. But reducing losses, it said, could happen at a slightly slower pace this year, since the company was planning to invest money into expanding its product portfolio to become a ‘full stack’ interior solutions provider.
“Our ambition over the course of the next year is to be a full stack player. We rule the loose furniture market and have a fairly decent business in the modular segment. Now we want to get into the full interior solutions experience. In the next year you will be seeing us put a lot of money into this expansion. The ambition by 2019 end is — no customer will need to go anywhere else outside of Pepperfry to get anything done for their house," according to Ambareesh Murty, founder and chief executive officer.
The company, which raised Rs250 crore over the last six months, said it was eyeing close to 50 Studio Pepperfrys, its offline experience stores, by March next year.
In May, the company had told Mint that it expected to set up 70 stores during the same timeframe. It had also said it planned to reduce EBITDA (earnings before interest, tax, depreciation and amortization) losses by 40 to 50% in 2017-18. While its offline network expansion was now expected to be slightly slower, the company managed to narrow EBITDA losses by 42% last year.
Furniture sales led the way in propping up revenue in 2017-18, Pepperfry said. Within furniture, the modular portfolio clocked the strongest performance, it added.
The company’s average order value for furniture also jumped 30% during the year. And when combined with home décor and homeware, the number was higher, it said.
In 2016-17, Pepperfry’s consolidated net losses narrowed 16.8% to ₹ 248.50 crore.
“All the actions that we took from the standpoint of making our business more omni-channel, reducing the dependency on pure brand marketing, ensuring we have great processes on supply chain and reducing our operating costs significantly, have worked out," according to Murty.