TIDMUBG
RNS Number : 9253B
Unbound Group PLC
17 February 2022
Unbound Group plc
Hotter Shoes Partnership with M&S
and
Trading Update for Hotter Shoes
17 February 2022
Unbound Group, which last month was admitted to trading on AIM,
is pleased to provide a trading update for its subsidiary Hotter
Shoes ("Hotter"), for the financial year ended 30 January 2022
(FY22). In addition, Hotter has agreed a partnership with Marks and
Spencer ("M&S") to sell Hotter products on the "Brands at
M&S" platform.
Unbound Group is a new online multi-brand retail platform which
is building on the strengths of, and customer loyalty to, Hotter,
which has recently been successfully transformed under a new
management team to become a digitally led retailer of comfort shoes
with a growing (currently 4.6m) customer database. Unbound Group is
developing its curated platform to offer a broader range of new and
complementary own-brand and third-party services for its core
target 55+ demographic. It is currently in discussion with a number
of future partners with a target launch in summer 2022.
Hotter partnership with M&S
The development of Hotter's own digital partnership strategy
continues to accelerate and, today, it announces that it has agreed
a partnership with M&S to sell Hotter products on the "Brands
at M&S" platform. This follows agreements with other retailers
including John Lewis, Next and The Very Group to sell Hotter
products online.
Hotter launches on M&S.com today, initially offering 32
products and increasing to 75 available directly via M&S.com.
The specially curated Hotter range for M&S.com will be centred
around comfort and active footwear and includes the comfort brand's
prestigious Gore-Tex range. Both women's and men's footwear ranges
will be available.
Hotter continues to focus on growing digital sales as part of
its omni-channel offering.
Hotter Trading Update
Hotter's performance, following its transformation to become a
digitally led business, continues to improve with Q4 delivering an
increase in revenues of 10% compared to the same quarter in the
prior year, achieving a gross margin above 61%, this being
accomplished despite headwinds from COVID and supply chain
challenges, though the latter improved and stabilised somewhat
during the quarter.
Revenues for the year ended 30 January 2022 are significantly
ahead of last year with an increase of 16% to approximately
GBP51.9m (FY21: GBP44.5m), despite the significant challenges
impacting the sector, particularly during the second half of the
financial year. This performance reflects the strength of Hotter's
products and multi-channel offering, with double digit percentage
revenue growth being achieved in both the digital and traditional
retail channels.
Hotter achieved significant increases in average selling prices
in FY22 of over 16% compared to the prior year, and an improved
gross margin to above 63%, an increase of over 9 percentage points
from FY21 (where the average selling prices were impacted as a
result of the pandemic). Hotter has seen a rapidly accelerating
capture of email addresses, growing by over 35% in FY22, taking its
emailable database to over one million (FY21: 767k).
On an IFRS basis, Hotter is expected to generate adjusted EBITDA
of approximately GBP5.5m for FY22 (FY21 loss of GBP0.9m). Profit
before tax and exceptional items for the year is anticipated to not
be below GBP0.2m, an improvement of over GBP6m compared with the
prior year (FY21 loss of GBP6.6m).
In addition, Hotter has significantly improved its net debt
position, with banking net debt reducing by over GBP6m to GBP8.5m
as at 30 January 2022 (FY21 GBP14.8m). The business successfully
completed its refinancing in December 2021, with amortising debt
facilities secured until December 2024.
The figures quoted above are subject to statutory audit.
Adjusted profit figures exclude exceptional items primarily
relating to IPO transaction costs.
Outlook
Looking ahead, management is confident in achieving the
medium-term growth targets for both Hotter and Unbound as outlined
on the Capital Markets Day in September 2021.
Specifically for Hotter, though supply chain disruption has been
a challenge during H2 FY22, the UK manufacturing facility provided
a level of resilience and availability improved during the final
quarter of FY22. The spring summer 22 collection has been
successfully launched in February 2022, with inventory on plan and
at optimum levels. Management has fixed pricing agreements in place
with a number of key suppliers and good flexibility within the
remaining cost base to mitigate potential risks to consumer
demand.
From an Unbound Group perspective, strong progress has been made
in developing the new multi-brand ecommerce platform with a launch
planned for this summer.
Ian Watson, Chief Executive Officer, commented:
"I am delighted that the progress we have made in resetting
Hotter continues to be translated into improved financial
performance and momentum. The partnership with M&S is further
testimony to Hotter's attractiveness to other best in class retail
platforms. The development of the Unbound Group platform is also
gathering pace, we have strengthened the management team and we are
currently engaged in positive discussions with a number of
potential partners."
ENDS
ENQUIRIES
Unbound Group plc
Dan Lampard
020 3874 8300
Stifel Nicolaus Europe Limited (Nomad and corporate broker)
Ash Burman, Nick Adams, Stewart Wallace, Francis North
020 7710 7600
Vico Partners
Harry Constant
020 3957 5045
NOTES TO EDITORS
Unbound Group plc
Unbound Group plc is the parent company for a group selling a
range of brands focused on the 55+ demographic. Unbound Group will
build on the solid foundation of Hotter Shoes, its current main
business, to grow value through its curated, multi-brand retail
platform supporting the active lifestyles of the 55+ demographic
with a range of products and services. Unbound's expanded offering
beyond footwear will feature a broad range of active lifestyle
products and services, with third-party complementary brands
featuring alongside new Unbound Group brands, as well as
Hotter.
Hotter Shoes
Hotter Shoes, an Unbound Group plc company, is one of the UK's
leading specialist footwear brands, selling over 1.4 million pairs
of shoes per year. Hotter's footwear has an uncompromising focus on
'customised comfort' and perfect fit through the use of its
differentiating technology, including its e-commerce platform, 3D
foot scanner and augmented reality app which enables the consumer
to try products virtually from home. Hotter has been transformed
from a retail to a digitally led, omni-channel business over the
past 3 years, selling its footwear to over 4 million customers via
online, its direct mail order channel and its targeted 17
Technology Centres and 7 garden centre concessions in the UK. With
its clearly defined, large and growing target demographic, Hotter
now reaches 29% of the female population in the UK over the age of
55. Digital partnerships have recently been established with
several online retailers including Next, John Lewis, The Very Group
and M&S.
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END
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