Could Moonpig Float Mean An Opportunity Is On The Cards?

Online greetings card and gift retailer Moonpig may consider a stock market IPO after experiencing thriving trading during the COVID-19 pandemic.

Moonpig Group has been under the ownership of private equity firm Exponent since 2016. Sky News reports that the company is currently in early-stage talks with investment banks regarding a potential stock market flotation.

One Million New Customers

The firm, which offers customizable greetings cards and gifts online, claims to have acquired over one million new customers during April and May of this year. Additionally, the company claims to have been the UK’s leading shopping app during the summer period.

Moonpig’s performance differs from that of high-street competitors such as The Card Factory and Clintons, who have struggled with low sales and reduced foot traffic to their stores due to lockdowns.

Moonpig’s financial performance is impressive, with sales of £172.8 million in 2020, a 44% increase from the previous year. Pre-tax profit has also increased by 137%, to £33 million.

Potential for Sustained Growth?

The question for potential investors is whether Moonpig can sustain this level of growth and profitability over a longer period, including a possible second lockdown or after restrictions on daily life are lifted. However, the fact that Kate Swann is currently CEO of the company may give investors confidence, as she helped transform the fortunes of the struggling WH Smith during her tenure as Chief Executive.

At present, Moonpig is playing down the significance of its discussions with investment bankers, stating that “as a high-growth company, we constantly evaluate our funding options and regularly meet with advisers on this subject.”

Regardless of whether Moonpig decides to pursue an IPO, it highlights the trend of businesses that can react with flexibility to changing market conditions and thrive without the burden of traditional bricks-and-mortar expenses.

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