Made.com Shares Fall Sharply as Group Confirms Potential Capital Raise

By Scott Kanowsky

Investing.com --Shares in Made.com (LON:MADE) slumped by more than 10% on Thursday after the struggling online furniture retailer confirmed that it is exploring a potential round of share sales to boost its balance sheet.

In a statement responding to recent media speculation, Made said it was "considering all options," including a possible equity capital raise. It added that a further announcement will be made "if and when appropriate."

The move follows a decision by Made last month to cut its annual revenue and profit outlook as surging living costs in the U.K. have led to consumers to pull back on spending. The firm now expects to slide to a core earnings loss of £50 million to £70 million this year, with gross sales also falling by between 15% to 30%.

It was the third profit warning issued by the group, which first floated in June 2021. Shares are now down by more than 90% since the market debut.

Made previously said that it was eyeing ways to bolster its balance sheet and address surging costs, adding that it is trying to navigate challenging conditions in the coming years.

Unaudited net cash stood at £31.5 million at the close of the first half, reflecting high investment in inventory, and is expected to come in at between £5 million and £30 million by the end of 2022.

The group, known for its fashionable furniture items aimed at younger consumers, also flagged that supply chain expenses are at elevated levels. Weighing on gross as well were larger-than-expected freight shipping costs and "significant" fuel surcharges.