E-commerce book retailer Booktopia Group (ASX: BKG) has made its debut on the ASX today, after raising $43.1 million through an initial public offering (IPO) at a price of $2.30.
The Booktopia share price jumped to as high as $2.86 just minutes after listing, but has since retreated to $2.69 at the time of writing.
Booktopia provides market update
Booktopia issued a trading update after the shares listed, saying that its November figures were closely tracking forecasts made on its IPO prospectus.
The company also advised that the first stage of its $20 million Sydney distribution centre is complete, and will be fully operational in time for Christmas trading.
This stage one completion has increased its potential capacity from 30,000 units to 60,000 units per day of outbound handling. Stage two meanwhile, will trial autonomous robots and reach shelves of up to 5m high – allowing more high-density shelving.
Commenting after the IPO, Booktopia chief executive Tony Nash said:
We are expecting our biggest Christmas ever, and with the ability to process up to 60,000 book sales a day, we will be able to satisfy more customers.
More about the Booktopia IPO
The decision to float Booktopia, which also owns the Angus & Robertson brand, was made after the company experienced a sales boom during the lockdown restrictions caused by COVID-19.
The company had delivered a full-year FY20 sales of $165 million, a 28% increase over FY19. Earnings before interest, taxes, depreciation and amortization (EBITDA) also rose strongly by 67% to $6 million.
In its prospectus, Booktopia says that its forecast total sales for the year ending 30 June 2021 will be $204.5 million, with an EBITDA of $9.4 million.
The Booktopia IPO raised $43.1 million, with the company offering 10.9 million new shares and 7.9 million existing shares at $2.30 per share – giving it a market value of $315.8 million.
Of the $43.1 million raised, Booktopia says it will use $25.1 million to boost resources at the company’s 14,000sq m warehouse, as well as pay down debt.
During the IPO book buildup, chief executive Nash said that online consumer book sales made up 15% of overall book sales in Australia.
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