EVE Esr 2022 Plc

 
 Eve Sleep plc (EVE) 
Eve Sleep plc: Year-end trading update 
 
21-Jan-2020 / 07:00 GMT/BST 
Dissemination of a Regulatory Announcement that contains inside information 
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
      Eve Sleep plc ("eve" or the "Company") 
 
      Year-end trading update 
 
  Strategic and operational progress, losses and cash burn reduced in-line 
      with plan 
 
 eve Sleep, the direct to consumer sleep wellness brand operating in the UK, 
 Ireland (together the 'UK&I') and France announces a trading update for the 
            year ended 31 December 2019. 
 
Operational and strategic highlights 
 
  · eve's premium hybrid product announced as the top scoring mattress by 
  Which? in December 2019; 
 
  · Product and range expansion in-line with the rebuild strategy, with the 
  contribution of non-mattress sales1 increasing by 200 bps in the UK and 
  600 bps in France; 
 
  · Customer repeat rates1 up 230 bps in the UK&I and 360 bps in France; 
 
  · Signed and launched retail partnerships with Argos, Homebase and Dunelm; 
 
  · Landing of new brand campaign featuring the eve sloth - increasing 
  unprompted awareness by 50%. 
 
Financial highlights 
 
  · Group revenues in core markets of GBP23.8 million (2018: GBP29.3m); 
 
  · 43% year-on-year reduction in full year EBITDA losses (GBP10.8m), ahead of 
  expectations; 
 
  · 51% full year reduction in cash burn; 
 
  · Net funds at 31 December 2019 of GBP8.1m, consisting of GBP7.8m of net cash 
  and GBP0.25m of advertising credits with Channel 42; 
 
  · Overheads for the year have reduced by 27% with further run-rate savings 
  in Q4. 
 
            2019 Trading 
 
    The Company has continued to progress its rebuild strategy, prioritising 
long term profitability and cash generation over short-term sales growth and 
market share gains. Notwithstanding the year on year decline in revenue, the 
Company has delivered a reduction in EBITDA losses ahead of its plans, along 
with a halving in the cash burn. This shift towards more efficient marketing 
    and higher quality traffic, coupled with a more streamline cost base has 
            driven a reduction in EBITDA losses for the full year of 43% to 
approximately GBP10.8m (2018: GBP19.2m). This translated into a 51% reduction in 
cash burn to GBP10.3m (2018: GBP20.9m) and a year-end net cash balance of GBP7.8m, 
             plus GBP0.25m of advertising credits with Channel 4. 
 
            2020 outlook 
 
   In Q4 2019 the Company made significant further cost reductions, which is 
       flowing through to an improving cash-burn and bottom line performance 
  compared to Q1-Q3 2019. Accordingly, management considers that its trading 
 in the last four months of the year is more indicative of its prospects for 
    2020. In the last four months of the year, the Company has for the first 
 time broken even at the operating level (positive margin contribution after 
            all direct and marketing costs but before overheads). 
 
        eve plans to publish its full year audited results on 24 March 2020. 
 
            James Sturrock, CEO of eve Sleep commented: 
 
   "We are delivering on our priorities of reducing losses and stemming cash 
       burn as we prioritise profitability over sales growth at any cost. We 
       continue to create award winning products to improve customer's sleep 
  wellness, as evidenced by our latest Which? Best Buy award for our premium 
           hybrid mattress, while removing unprofitable sales and marketing. 
 
     We are well placed to make further significant progress in 2020, with a 
       differentiated brand position, a broader product range than peers and 
  ongoing improvements to the customer experience, supported by a lower cost 
            base, a substantial cash balance and no debt. " 
 
            Footnote 
 
           1 The split of non-mattress revenues and the customer repeat rate 
     calculations are based on sales made through the eve website, excluding 
            sales made through other channels such as retail partnerships 
 
     2 As part of the fund raise in February 2019, the Group raised GBP0.9m of 
      advertising credits with Channel 4, of which GBP0.25m is remaining at 31 
            December 2019 
 
 The information contained within this announcement is deemed by the Company 
          to constitute inside information stipulated under the Market Abuse 
            Regulation (EU) No. 596/2014. 
 
For enquiries, please contact: 
 
eve Sleep plc 
 
James Sturrock, Chief Executive        via M7 Communications LTD 
Officer 
 
Tim Parfitt, Chief Financial Officer 
finnCap Ltd - Nominated Adviser and    Tel: +44 (0)20 7220 0500 
Broker 
 
Matt Goode / Hannah Boros - Corporate 
Finance 
 
Alice Lane - Equity Capital Markets 
M7 Communications LTD - PR/IR          Tel: +44(0)7903 089 543 
 
Mark Reed 
 
ISIN:          GB00BYWMFT51 
Category Code: TST 
TIDM:          EVE 
LEI Code:      2138007BAC29AUXWQE6 
Sequence No.:  41653 
EQS News ID:   957439 
 
End of Announcement EQS News Service 
 
 

(END) Dow Jones Newswires

January 21, 2020 02:00 ET (07:00 GMT)

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