Full Year Trading Update

RNS Number : 2266A

Warpaint London PLC

01 February 2022

 

1 February 2022

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

Warpaint London PLC

("Warpaint", the "Company" or the "Group")

Full Year Trading Update

Strong 2021 trading and results expected to be ahead of market expectations

Warpaint London plc (AIM: W7L), the specialist supplier of colour cosmetics and   owner of the W7 and Technic brands is pleased to announce an update on trading for the year ended 31 December 2021.

The Company announced in its trading update on 2 November 2021, sales for the year ending 31 December 2021 were expected to be similar to those achieved in 2019 (2020: £40.3 million, 2019: £49.3 million), the most recent financial year that experienced no impact from the Covid-19 pandemic.  Following completion of the year, the Company is now pleased to report that unaudited sales for the year ended 31 December 2021 have exceeded those achieved in 2019 at £50 million.

Gross margins for the year ended 31 December 2021 were maintained ahead of those achieved in 2020 and 2019 at approximately 33.8% (2020: 31.1%, 2019: 33.5%), despite increased costs in the supply chain, particularly in respect of freight.

For the year ended 31 December 2021, subject to audit, the Group's Adjusted EBITDA*is expected to be approximately £7.7 million (2020: £4.2 million, 2019: £7.0 million) and Adjusted Profit Before Tax** (2020: £2.3 million, 2019: £5.2 million) is expected to be approximately £6.6 million, both of which are ahead of market expectations.

The Company's cash balances as at 31 December 2021 totalled £4.1 million (31 December 2020: £4.9 million) and the Company had no debt, after significant stock purchases to satisfy anticipated Q1 2022 demand.

The Group expects to release its results for the year ended 31 December 2021 in April 2022.

* Adjusted for foreign exchange movements, share based payments and exceptional items.

** Adjusted for exceptional costs, amortisation of intangible assets, and share based payments. Adjusted numbers are close to the underlying cash flow performance of the business which is regularly monitored and measured by management.

Commenting, Sam Bazini Chief Executive, said: "I am pleased to report that we ended 2021 ahead of current market expectations.  In 2021 we enjoyed particularly strong sales growth in the UK, significant growth internationally and further increases in online sales.  It was pleasing that we were able to maintain our margins at pre-pandemic levels, despite some inflationary headwinds, particularly with freight costs.

"We expect to see a continuing improvement in performance in 2022 and have started the year strongly.  In line with our stated strategy we have significant opportunities for further growth, both with our existing retailers, and those such as Boots where we are expecting to launch very shortly, together with others that we are in discussions with.  I look forward to providing further updates at the time of the release of the Group's results in April."

Enquiries:

Warpaint London	c/o IFC
Sam Bazini - Chief Executive Officer Eoin Macleod - Managing Director Neil Rodol - Chief Finance Officer
Singer Capital Markets (Nominated Adviser & Joint Broker)	020 7496 3000
Shaun Dobson, Tom Salvesen, Jen Boorer, Alex Bond - Investment Banking
Shore Capital (Joint Broker)	020 7408 4090
Patrick Castle, Daniel Bush - Corporate Advisory Fiona Conroy - Corporate Broking
IFC Advisory (Financial PR & IR)	020 3934 6630
Tim Metcalfe Graham Herring Florence Chandler

Warpaint London plc

Warpaint sells branded cosmetics under the lead brand names of W7 and Technic. W7 is sold in the UK primarily to retailers and internationally to local distributors or retail chains. The Technic brand is sold in the UK and continental Europe with a significant focus on the gifting market, principally for high street retailers and supermarkets. In addition, Warpaint supplies own brand white label cosmetics produced for several major high street retailers. The Group also sells cosmetics using its other brand names of Man'stuff, Body Collection, Very Vegan, and Chit Chat.

 

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