TIDMITS
RNS Number : 9904I
In The Style Group PLC
08 December 2022
THIS IS AN ANNOUNCEMENT UNDER RULE 2.4 OF THE CITY CODE ON
TAKEOVERS AND MERGERS (THE "CODE") AND IS NOT AN ANNOUNCEMENT OF A
FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. THERE
CAN BE NO CERTAINTY THAT SUCH AN OFFER WILL BE MADE, NOR AS TO THE
TERMS ON WHICH ANY OFFER MIGHT BE MADE.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE UK VERSION OF THE EU MARKET ABUSE REGULATION
WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION
(WITHDRAWAL) ACT 2018, AS AMED AND SUPPLEMENTED FROM TIME TO TIME
INCLUDING BY THE MARKET ABUSE (AMMENT) (EU EXIT) REGULATIONS 2019
(SI 2019/ 310).
8 December 2022
In The Style Group plc
Strategic review
Trading update
Board changes
In The Style Group plc (AIM:ITS) ("In The Style", the "Company"
or, together with its subsidiary undertakings, the "Group"), the
disruptive and inclusive digital womenswear fashion brand,
announces changes to its Board of Directors (the "Board" or the
"Directors"), the commencement of a strategic review and a business
update.
In a separate announcement the Company has also today announced
its interim results for the six months ended 30 September 2022 (the
"Interim Results") together with a trading update and outlook
statement, some of which is repeated below.
Strategic review
The Board believes that there has been limited liquidity for In
The Style's shareholders for some time and that the current market
capitalisation of the Company does not properly reflect the
underlying growth potential of the Group which may be better
realised under an alternative ownership structure.
The Board has, therefore, decided to conduct a strategic review
of the Group's business as a whole (the "Strategic Review") and has
appointed Lincoln International to assist with this process. The
outcome of the Strategic Review may or may not result in a sale of
the Company or some or all of the Group's business and assets. The
Company is not in talks with any potential offeror and is not in
receipt of any approach with regard to a possible offer.
As a consequence of this announcement, an 'offer period' has now
commenced in respect of the Company in accordance with the rules of
the Code and the attention of shareholders is drawn to the
disclosure requirements of Rule 8 of the Code, which are summarised
below.
Current trading and FY23 outlook
-- The Board confirms that its expectation for full year Adjusted EBITDA remains unchanged.
-- Trading within our direct-to-consumer ("DTC") channel through
the important peak period of November has been strong. In
particular, In The Style is pleased to have delivered a record
Black Friday Cyber Fortnight, as follows:
- gross order value 6% higher than 2021 (12% higher than 2020);
- average order value up 12% on 2021 (24% up on 2020); and
- gross margin 1.8%pts above that achieved in 2021, with a lower level of discounting.
Nevertheless, consumer sentiment remains uncertain and so the
Company now expects DTC revenue for the full year to be broadly
similar to that achieved in FY22.
-- Wholesale is likely to continue to be a challenge and the
Company would expect revenue in H2 2023 to be similar to that
achieved in H1 2023.
-- Stock levels heading into Christmas period are being well
managed with stock volume at the end of November being 8% less than
the prior year.
-- Cash position improved to GBP4.4 million at 30 November 2022,
due to favourable working capital movements with an additional
GBP1.1million available through the invoice discounting
facility.
-- Underpinned by the Group's distinctive brand and
differentiated model, the Board looks forward to continuing the
strong strategic momentum delivered throughout H1 2023 and is
confident of the long-term growth prospects of the Group.
Board changes
Sam Perkins has informed the Board of his intention to step down
as Group Chief Executive Officer ("CEO"). Sam will leave In The
Style on 31 December 2022. During Sam's tenure as CEO, the Group
has developed and begun to implement several strategic initiatives
to support the Group's future growth.
Adam Frisby, the Company's founder, will return to the role of
CEO on an interim basis. Adam led the Group as CEO for nine years
until January 2022. Since then, Adam has held the role of Chief
Brand Officer, with responsibility for developing the Group's
influencer partnerships and the brand's creative direction.
Jim Sharp, Chair of In The Style said:
"On behalf of the Board, I would like to place on record my
thanks to Sam for his contributions during his time as the Group's
CEO. Adam is excited to return to the role of CEO at this important
time. As the Group's founder and major shareholder, Adam is well
placed to lead the business and ensure it delivers its considerable
potential."
Business summary
In The Style is an innovative, inclusive online women's clothing
brand. The Company is differentiated by its innovative social media
influencer collaborations and engaging brand campaigns on key
issues that matter to its customers.
-- The Group was founded by Adam Frisby in 2013 and since then
has delivered eight consecutive years of unbroken revenue growth,
reporting net sales of GBP57 million in the year ended 31 March
2022).
-- In The Style's in house design team works with social media
influencers to design clothing collections which are manufactured
by third parties predominantly in the UK and Far East.
-- In The Style has a highly engaged active customer base of
over 750,000 who purchase directly from the Company through its
proprietary app and its website www.inthestyle.com . In addition,
the Company sells through digital wholesale partners.
-- In The Style is an industry champion for female empowerment,
body confidence and real beauty with a proactive sustainability
agenda. Inclusivity is at the core of the In The Style brand, which
actively promotes products for a wide range of body types and
styles.
The Company announced this morning its interim results for the
six months ended 30 September 2022. These included the following
highlights:
-- DTC revenue remained broadly flat at GBP22.8 million (H1
2022: GBP23.0 million). In a challenging market, the Group
continues to leverage its distinctive influencer collaboration
model to drive real interest in the product that it designs for
consumers.
-- The Group launched 72 collections with 19 distinct influencers through its distinctive social collaboration model. To complement this, the Group increased the level of reach generated through its micro-influencer network, engaging with over 140 different micro-influencers with a combined reach of over 2.8 million followers.
-- The successful launch of 'FITS', a collection of own-brand
wardrobe staples, providing the Group with additional opportunities
to engage with customers and to improve profitability. The FITS
brand debuted in August 2022 and the Group has released over 160
products to date with over 5,900 customers purchasing at least one
of these products.
-- The Group is proud to have collaborated with the late Dame
Deborah James to raise GBP1.7 million for the Bowelbabe fund for
Cancer Research UK.
-- The successful relocation to a larger 84,000 sq. ft.
warehouse at the end of August 2022 provides an opportunity for
operational efficiencies and sufficient capacity for future
growth.
The person responsible for arranging the release of this
announcement on behalf of the Company is Richard Monaghan, the
Chief Financial Officer of the Company.
For media enquiries:
In The Style Group plc Via Hudson Sandler
Jim Sharp, Chairman
Rich Monaghan, Chief Financial Officer
Hudson Sandler +44 (0)20 7796 4133
Alex Brennan inthestyle@hudsonsandler.com
Lucy Wollam
Ben Wilson
Lincoln International LLP (Financial Adviser) +44 (0)20 7022 9880
Harry Kalmanowicz
Julian Tunnicliffe
Liberum Capital Limited (Nomad and Broker) +44 (0)20 3100 2000
Clayton Bush
Scott Mathieson
Miquela Bezuidenhoudt
About In The Style
In The Style is a fast-growing digital womenswear fashion brand
with an innovative social media influencer collaboration model.
Founded in 2013 by entrepreneur Adam Frisby, the brand champions
inclusivity, body positivity and real beauty.
The brand's innovative and highly adaptable influencer
collaboration model, which sees it work with influencers on a
long-term basis to collaboratively design, develop and promote
branded collections, differentiates it from competitors. In The
Style currently partners with a stable of 25+ influencers,
including Jac Jossa, Stacey Solomon and Perrie Sian.
For more information, please visit
https://corporate.inthestyle.com/about/ .
IMPORTANT NOTICES
General
This announcement is for information purposes only. It does not
constitute an offer or form part of any offer or an invitation to
purchase, subscribe for, sell or issue any securities or a
solicitation of any offer to purchase, subscribe for, sell or issue
any securities pursuant to this announcement or otherwise in any
jurisdiction in which such offer or solicitation is unlawful. The
distribution of this announcement in jurisdictions outside the
United Kingdom may be restricted by law and therefore persons into
whose possession this announcement comes should inform themselves
about, and observe such restrictions. Any failure to comply with
the restrictions may constitute a violation of the securities law
of any such jurisdiction.
Financial and other advisers
Lincoln International LLP ("Lincoln"), which is authorised and
regulated in the United Kingdom by the Financial Conduct Authority,
is acting exclusively as financial adviser to In The Style Group
plc and no one else in connection with the Strategic Review and
will not be responsible to anyone other than In The Style Group plc
for providing the protections afforded to clients of Lincoln nor
for providing advice in relation to the Strategic Review or any
other matters referred to in this announcement. Neither Lincoln nor
any of its affiliates owes or accepts any duty, liability or
responsibility whatsoever (whether direct or indirect, whether in
contract, in tort, under statute or otherwise) to any person who is
not a client of Lincoln in connection with this announcement, any
statement contained herein or otherwise.
Liberum Capital Limited ("Liberum"), which is authorised and
regulated in the United Kingdom by the Financial Conduct Authority,
is acting exclusively as nominated adviser and corporate broker to
In The Style Group plc and no one else in connection with the
Strategic Review and will not be responsible to anyone other than
In The Style Group plc for providing the protections afforded to
clients of Liberum nor for providing advice in relation to the
Strategic Review or any other matters referred to in this
announcement. Neither Liberum nor any of its affiliates owes or
accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Liberum in
connection with this announcement, any statement contained herein
or otherwise.
Disclosure requirements of the Code
Rule 2.9 disclosure
In accordance with Rule 2.9 of the Code, the Company confirms
that, as at the date of this announcement, its issued and fully
paid share capital consists of 52,499,998 ordinary shares with par
value of GBP0.0025. The International Securities Identification
Number (ISIN) for the ordinary shares is GB00BMXMR838.
Rule 8.3 disclosure
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any securities exchange offeror (being any offeror
other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer
period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person's interests
and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) of the Code applies must be made by no
later than 3.30 pm (London time) on the 10th business day following
the commencement of the offer period and, if appropriate, by no
later than 3.30 pm (London time) on the 10th business day following
the announcement in which any securities exchange offeror is first
identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a
Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any securities exchange offeror. A
Dealing Disclosure must contain details of the dealing concerned
and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror, save to the
extent that these details have previously been disclosed under Rule
8 of the Code. A Dealing Disclosure by a person to whom Rule 8.3(b)
of the Code applies must be made by no later than 3.30 pm (London
time) on the business day following the date of the relevant
dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3 of the Code.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of
the Code).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Takeover Panel's Market
Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as
to whether you are required to make an Opening Position Disclosure
or a Dealing Disclosure.
Rule 26.1 disclosure
In accordance with Rule 26.1 of the Code, a copy of this
announcement will be available (subject to certain restrictions
relating to persons resident in restricted jurisdictions) on the
website of In The Style at https://corporate.inthestyle.com
promptly and by no later than 12 noon (London time) on the business
day following this announcement. The content of the website
referred to in this announcement is not incorporated into and does
not form part of this announcement.
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END
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