Lower revenues from the Nomad software platform in China hampered progress at Aquis-quoted Samarkand (LON: SMK), although there was a larger contribution from the brands that the company owns.
Covid lockdowns in China hampered e-commerce trading and made it more difficult to deliver products. It also meant that potential new clients have delayed signing up to the platform.
In the six months to September 2022, group revenues improved from £7.17m to £8.25m, while the loss was reduced from £3.53m to £2.18m. Distribution costs and overheads were lower, and they could be further reduced in the second half.
The Nomad division’s revenues were 10% lower, but that was more than made up for by increased brand revenues, which are mainly generated in the UK. The distribution business, which had been falling, also increased revenues.
Technology investment will enable Samarkand to offer its e-commerce technology outside of China.
The second half, which tends to be stronger, will be affected by the same problems as the first half, although they appear to be easing. Brand revenues should continue to increase. A full year loss of £4.1m is forecast. The share price is unchanged at 53p. The March 2021 flotation price was 115p.
