Temple & Webster Half-Year Results Signal Accelerating Scale and Market Share Gains

Source: Kapitales Research

Highlights:

• Revenue rose 19.8% year-on-year to AU$375.9 million in H1 FY26, with market share reaching 2.9%
• EBITDA (pre-New Zealand investment) increased 13.0% to AU$14.9 million, with a margin at 4.0%
• Cash position strengthened to AU$160.6 million, with AU$23 million in free cash flow generated

Temple & Webster Group Ltd (ASX: TPW) released its half-year results for the six months ended 31 December 2025, reporting continued expansion in revenue and customer metrics. The online furniture and homewares retailer reported revenue of AU$375.9 million, representing a 19.8 per cent increase from AU$313.7 million in the prior corresponding period. Management noted that momentum strengthened across the half, with the company’s market share rising to 2.9 per cent of the Australian furniture and homewares market.

Profitability and Margin Trends

Delivered margin increased 12.8% to AU$114.5 million, while reported EBITDA rose modestly to AU$13.5 million. On a comparable basis, excluding New Zealand start-up investment, EBITDA was AU$14.9 million, representing a margin of 4.0%. The 24-basis-point year-on-year decline in EBITDA margin reflects continued reinvestment in marketing, pricing, and growth initiatives aimed at strengthening competitive positioning.

Operating indicators remained solid, with active customers rising 14 per cent to approximately 1.4 million. Repeat customers continued to form the majority of activity, contributing 62 per cent of total orders. Conversion rates improved to 3.2%, indicating stronger on-site engagement. Fixed costs as a percentage of revenue declined to 9.4% from 10.5% in the prior corresponding period, highlighting operating leverage despite ongoing investment in expansion.

Capital Management

The business generated AU$23 million in free cash flow during H1 FY26, demonstrating the resilience of its asset-light, negative working capital model. Cash and cash equivalents rose to AU$160.6 million, with the balance sheet remaining debt-free. During the period, AU$7.5 million was deployed toward the company’s on-market share buy-back program, reflecting a disciplined approach to capital allocation while maintaining flexibility for growth.

Trading Update and Outlook

Revenue from 1 January to 9 February 2026 rose 20% year-on-year, driven by accelerating new customer acquisition and continued strength in repeat purchasing. EBITDA margin guidance for FY26 remains in the range of 3–5%, consistent with the company’s strategy of prioritising market share expansion while maintaining disciplined profitability. Management also reiterated its medium-term objective of exceeding AU$1 billion in annual revenue.

Overall, the H1 FY26 result underscores sustained structural momentum in Temple & Webster’s online retail platform, supported by customer growth, cost efficiency, and a robust balance sheet position.

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