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KGN

Kogan.com Launches Equity Raise and Provides Company Update Through Investor Presentation

Max Molinari

Max is an Equity Analyst with ASR Wealth Advisers. He has studied a Bachelor of Business and a Bachelor of Laws at the University of Technology, Sydney. Max currently holds RG146 qualifications.

Kogan.com (ASX: KGN) is currently in trading halt pertaining to an equity raise and have also provided a presentation to investors regarding the company’s current position and future outlook. Both announcements are price sensitive and thus, we expect some considerable price movement when trading commences again on Thursday 11 June. To provide some background, Kogan.com is an Australian portfolio of retail and services businesses including Kogan Retail, Kogan Marketplace, Kogan Mobile, Kogan Internet, Kogan Insurance, Kogan Health, Kogan Pet Insurance, Kogan Life Insurance and Kogan Travel. The company has a market capitalisation of A$1.194 billion and is trading at near all-time highs at $12.38 per share (a 226%+ increase from its COVID-19 low in mid-March).

 

KGN

Kogan.com (ASX: KGN) has launched an equity raise and provided a presentation to investors regarding the company’s current position. (Source: Kogan.com).

 

KGN announced an equity raise shortly before market open this morning, which consists of a $100 million fully underwritten placement on offer at $11.45 per share (a 7.5% discount to the last close price at Tuesday 9 June 2020 of $12.38), as well as a non-underwritten share purchase plan to raise up to $15 million. In the company’s announcement, however, the description of the use of the proceeds was rather vague. Kogan.com claims that the capital from the raise will be used to

provide financial flexibility to act quickly on future value accretive opportunities

 

leading some investors to believe that the raise could just be an opportunity to cash in on the recent rapid increase in share price as of late.

In KGN’s investor presentation, the company announced that they have achieved gross sales year-on-year growth of 103.6% across April and May 2020, as well as adjusted EBITDA year-on-year growth of 219.3% across the same period. The company prides themselves on being highly cash generative and therefore not needing to raise capital (despite paying out regular dividends), which is why the latest announcement came as a surprise to some investors. Between listing in July 2016 and its current levels in June 2020, Kogan.com has delivered an impressive total shareholder return of 654.5%.


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)
(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).
This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law, we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.
ASR has no position in any of the stocks mentioned.

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