Music Magpie has reported a decline in revenue but expects Black Friday to give it a boost

The retailer reported group revenue of £53.8m in the six months ended May 31, down from £61.9m in the same period last year.

Music Magpie said the decline was due to the planned conversion of the group’s US business into a sourcing-only operation.

Loss before tax reduced slightly to £3m from £3.2m in the first half of 2023, while adjusted EBITDA fell from £2.8m to £2.4m.

UK consumer technology sales were flat at £28.7m compared to £28.6m last year, while US consumer technology sales plummeted from £8.5m to £1.6m due to the change to a sourcing-only operation.

Rental revenue slipped from £4m to £3.8m and active subscribers decreased by 600 members. Disc media and book sales were down 5.7% to £19.7m, “representing a significant reduction on the declines seen in previous years”.

Music Magpie also launched the buying of branded fashion on the platform as the “next step in unlocking a world of inventory from people’s homes”.

The group said macroeconomic headwinds meant trading conditions have been “challenging”, but it expects the second half of the year to perform better as Black Friday pulls in the majority of the retailer’s profits.

Chief executive Steve Oliver said: “Amidst an increasingly competitive environment for second-use technology, and with consumers continuing to feel the squeeze on their wallets, the market has undoubtedly been challenging. 

“However, our turnover remained robust in the UK, where consumer technology sales held firm, and disc media and books showed welcome signs of stabilisation.

“We have been proactive in delivering savings to our cost base and right-sizing our business. Combined with our efforts to refine and improve the way in which we buy, sell and rent, our business is now in a stronger position and better able to capitalise on the continued growth of second-use markets. 

“We have recently launched the buying of branded fashion items on the Music Magpie platform and intend to continue broadening our offering and further unlock the ‘world of inventory’ that sits in consumers’ households.”