TIDMSUP
RNS Number : 4491Q
Supreme PLC
18 October 2023
18 October 2023
Supreme plc
("Supreme," the "Company" or the "Group")
Vaping Category Update
Supreme (AIM: SUP), a leading manufacturer, supplier, and brand
owner of fast-moving consumer products, today outlines a series of
proactive measures within the Group's owned-brand vaping products
to seek to mitigate the growing rise of underage vaping as well as
reduce the environmental impact of disposable vapes.
As an industry leader, and to ensure its owned brands do not
create any interest from underage vapers, Supreme today announces
the following proactive measures over the coming months, which it
believes should be adopted across the UK vaping market:
1. Plain packaging: Packaging across its entire 88vape range,
from disposables to 10ml liquids, will be immediately assessed to
ensure the use of colour is very limited (used only to
differentiate one stock item from another) and the packaging is
plain and uniform. Supreme does not use images, cartoons or
characters on its packaging.
2. Discontinue all bright coloured disposables: The Company's
88vape disposable range will be switched to either plain black,
white or grey hardware with any bright colours discontinued at the
earliest opportunity.
3. Age-appropriate flavours only: The naming conventions of all
flavours across the 88vape range will be simplified, for example
"Peach Dream" will be become "Peach" and "Sweet Strawberry" will
become "Strawberry" to reduce the shelf appeal for underage vapers.
Any flavours which are likely to be more appealing to underage
vapers will be removed entirely from the range.
4. To trade only with retailers with age robust verification:
Supreme will increase its 'pre-order' due diligence on all
retailers and e-tailers in its network to ensure they expressly
confirm that they have robust age verification protocols in place.
Supreme will no longer trade with those that cannot comply with
this requirement.
5. Responsible location of products in store: Supreme will
strongly recommend to all retailers that their Vaping products
should not be located close to confectionery and will work with
retailers to find a suitable location in store to avoid underage
vapers from coming into contact with vaping products.
6. Vape disposal bins in store: Supreme is currently rolling out
vape disposal units across the entire estate of its largest
customer, B&M Retail, in a bid to encourage more responsible
disposal of the single use devices.
7. Government co-operation: Supreme will continue to cooperate
with the government in all its efforts to combat underage vaping
and would welcome further legislation of the industry, such as
those proposed by the Vaping Industry Association who argue that
the sale of vaping products should be licenced with substantial
fines for those retailers that are found to be selling vapes to
underage individuals.
8. Industry co-operation: Supreme will encourage other vape
brand owners that they work with to follow suit.
Sandy Chadha, Chief Executive Officer of Supreme, commented:
"As a business, we are fully committed to eradicating underage
vaping so that the industry can get back to its core objective; to
support adult smokers to find an affordable, sustainable, safer
alternative to smoking. Whilst we believe flavoured vapes are a
critical part of many ex-smokers 'quitting journey' as they seek to
replace that tobacco taste for something more palatable, we are
also desperate to ensure that those flavours do not spark any
interest in younger people.
We are fully supportive of any further legislation in the sector
and believe it is the right thing to do to begin to transition our
business by removing or changing anything from within our product
set that could be deemed compromising. As government guidance
evolves we may seek to re-assess this approach."
"I would like to go on record to pledge my support to the
initiatives currently being recommended to the government by the
Vaping Industry Association who argue that licensing the sale of
vaping products (similar to alcohol) will directly address the
problem such that only reputable and responsible retailers should
be permitted to sell vapes in the first place with substantial
fines for those that are found to be selling vapes to
children."
"Finally, I would also like to highlight the 'black market' or
illicit vape market to the government as a core source of vapes for
young people given their accessibility and the interest generated
by these brands on social media. These illicit vaping products
which are non-compliant with UK regulations and have larger tank
sizes (meaning they last longer), higher nicotine concentrations
and can contain banned products. Unless we stand up to this black
market (by stricter border-force and increased investment into
trading standards) then even the strictest laws governing the legal
vape market won't make a notable change to whether young people
choose to vape."
As announced separately today, Supreme continues to trade in
line with expectations(1) for the year ended 31 March 2024, which
were significantly increased on 26 September 2023. A copy of the
Company's trading update issued today is available at:
https://investors.supreme.co.uk/regulatory-announcements/ .
(1) Company compiled analyst Adjusted EBITDA(2) consensus for
the year ending 31 March 2024 prior to release of this announcement
was GBP29 million.
(2) Adjusted EBITDA means operating profit before depreciation,
amortisation, share-based payments charge, fair value movements on
non-hedge accounted derivatives and exceptional items.
Enquiries:
Supreme plc via Vigo Consulting
Sandy Chadha, Chief Executive Officer
Suzanne Smith, Chief Finance Officer
Grant Thornton UK LLP (Nominated Adviser)
Samantha Harrison / Harrison Clarke / Samuel
Littler +44 (0)20 7383 5100
Berenberg (Broker)
Mark Whitmore / Marie Moy / Mara Grasso +44 (0)20 3207 7800
Vigo Consulting (Financial Public Relations)
Jeremy Garcia / Kendall Hill
supreme@vigoconsulting.com +44 (0)20 7390 0230
About Supreme
Supreme supplies products across five key categories; batteries,
lighting, vaping, sports nutrition & wellness, and branded
household consumer goods. The Company's capabilities span from
product development and manufacturing through to its extensive
retail distribution network and direct to consumer capabilities.
This vertically integrated platform provides an excellent route to
market for well-known brands and products.
The Group has over 3,300 active business accounts with retail
customers who manage over 10,000 branded retail outlets. Customers
include B&M, Home Bargains, Poundland, Tesco, Sainsburys,
Morrisons, Amazon, The Range, Costcutter, Asda, Halfords, Iceland
and HM Prison & Probation Service.
In addition to distributing globally-recognised brands such as
Duracell, Energizer and Panasonic, and supplying lighting products
exclusively under the Energizer, Eveready, Black & Decker and
JCB licences across 45 countries, Supreme has also developed brands
in-house, most notably 88Vape and has a growing footprint in Sports
Nutrition and Wellness via its principal brands Sci-MX and Battle
Bites.
investors.supreme.co.uk/
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END
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