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Just taking a quick look at Simba Vs Eve on Trustpilot. IMPERFECT measure of course but Simba already have 400 reviews in January 2021 while Eve have 67. Don't for a second think I'm knocking Eve; I'm looking for evidence that Simba may be telling the truth (or nearly the truth) in that City AM piece. Take a look. Simba have consistently beaten Eve (with it's £24m revenue forecast) by a factor of 3, and they are beating their own Jan and Feb 2020 (and even March 2020) figures by a factor of roughly 3, too. Might they nearly be at £100m revenue for real?? And if Eve have boosted their own figures through lockdown by a similar multiple, compared to pre-lockdown, then possibly good for Eve – as we could soon find out
https://uk.trustpilot.com/review/simbasleep.com/transparency
https://uk.trustpilot.com/review/www.evesleep.co.uk/transparency
One note on Trustpilot. The eagle eyed may have noted that the main bulk of reviews are now ‘verified’ rather than ‘invited’. My basic checking seems to imply that eve have upgraded to an automated system for buyer reviews so we should get more frequent and a greater quantity of reviews coming through than previously (where I believe they would have to manually invite people to respond).
PS. Yes, there are more bad reviews which I didn't mention. However, I've heard that they are conscious of that (caused by being busy) and are hiring staff such as this job:
Customer Service Representative
eve sleepTemple, England, United Kingdom
6 days ago Over 200 applicants
https://uk.linkedin.com/jobs/view/customer-service-representative-at-eve-sleep-2213578535?refId=2d8f642f-a1d7-4ff5-ac9d-c41e2af3b07f&position=14&pageNum=0&trk=public_jobs_job-result-card_result-card_full-click
Trustpilot October https://uk.trustpilot.com/review/www.evesleep.co.uk/transparency
Beating last winter by far (except Feb) and beating spring and early lockdown. Not beating July and August but the bricks-and-mortar mattress places were probably open too then, and people still reviewed at Eve. July and August sales' figures will be included the next trading update; too late for the last TU to 30/6.
Nothing there to dampen my own optimism.
Like I said yesterday, follow the big trades, and ignore the little fluctuations atm....IMHO.
The real move,( hopefully north....) will resume once we get the next trading update which again (hopefully...) will confirms further rise in sales and further improvements of cash position.
GLA.
Follow the big trades with the smart money....a high possibility of another lockdown ( unfortunately...) will bond well with our online growing market....buying just above 4p should and hopefully would be handsomely rewarded IMHO.
GLA.
Hi DG, we will see later today I think. Its taken a little bit longer but it all seems ready to pop to me, but... who knows!
Regards Xmas shopping I think as it will be all on line this year, people will start earlier if they can. Don't want products to be sold out or deliveries, due to demand, take longer to arrive etc? I for instance, co-incidently, started this week on that basis.
Incidentally Wyn, I moved a little bit more money to your favourite share today, partly in response to your ‘choreographed’ reference. Fingers firmly crossed for next 48 hours! I’m guessing the charts tell you nothing there..
As for eve products in Boots, I don’t really think people are buying for Christmas yet are they? The Eve ‘3for2’s’ are more stocking fillers than the main shebang aren’t they? I think I’d be in trouble if I only bought a hot water bottle for Mrs G-Man. I think they will be in stock before long and in reasonable time
We should get an inkling of the situation in a little less than a month; 'Black Friday date is November 27' so if they have plenty of deals around that time I'd (optimistically speaking as ever) take that as a steer things are going well enough.
@Wyndrum - Tell me about it! Wish I was still working in the consumer goods space and had better analytical tools at my disposal haha
I also share your views regarding inventory - the anecdotal evidence seems to be pointing towards supply chain issues / extremely conservative working capital management. Boots STILL has "Stock coming soon" on a number of items which I find surprising and a tad worrying
Hi raz, I hink that's everybody'd concern right now incl. CC! its just impossible for us amateurs to have the first idea of actually how its going. What makes its harder too, is that profitability is on a knife edge. (I don't mean that in a neggo way). Just that its been such a push to get to here, that it would be darn bad luck if sales just dropped off enough to keep that elusive overall profitability still beyond Eve's fingertips.
Still with the cash in the bank it does underpin the SP I would have thought.( Chartwise it could get a little hairy if it drops below 4p) Fingers crossed it doesn't
My main concern is that their luxury proposition may not be that appealing given current economic climate. That said, those who are managing to work from home have more money than ever with a lack of commuting, no post work drinks / dinners, no holiday etc .
Hi Wyn. That’s a fair counter assumption. I see on their website that the lead times on mattresses are now pushed out to 8-9 weeks. That’s across the board so suggests maxed out capacity somewhere in supply chain so whilst I was optimistic and positive about demand, im hoping they can resolve any bottlenecks quickly.
If you were to look back 12/16 months you will find their stock levels were much higher and has allowed the company some leeway in the the last financial restructure. All said we are coming to what is the busiest time of the year or at least it would normally be that way but who knows now? people or so unpredictable.
StarS you said "As an aside, the grey variant of the original has sold out - which seems incredibly positive when, as you say, it’s their largest line so assumedly was incredibly well stocked."
I don't know why you would assume that? It could be they are keeping stocks very low to not tie up capital? Don't know if they are or not, just would not make your assumption, that's all.
A consideration when looking at YoY prices is the reduction in marketing spend.
Last year out every £1 of revenue 75p was going on marketing spend. Now its closer to 25p. So if you reduce prices by 30% this will give a margin after marketing of 100 * 70% - 25p = 45p. This compares to last year which was 100 - 75p = 25p.
So last year was heavy marketing, higher prices, for a post marketing margin of 25%. This year is lower, more tactical marketing, but lower prices for a post marketing margin of 45%.
A consideration when looking at YoY prices is the reduction in marketing spend.
Last year out every £1 of revenue 75p was going on marketing spend. Now its closer to 25p. So if you reduce prices by 30% this will give a margin after marketing of 100 * 70% - 25p = 45p. This compares to last year which was 100 - 75p = 25p.
So last year was heavy marketing, higher prices, for a post marketing margin of 25%. This year is lower, more tactical marketing, but lower prices for a post marketing margin of 45%.
I read that situation a slightly different way. To correct, I believe it’s 30% off the original not 50% (Likely to match competitors on this product type). Also, they are not discounting any other range suggesting that sales are robust enough without discounting required across the board. As an aside, the grey variant of the original has sold out - which seems incredibly positive when, as you say, it’s their largest line so assumedly was incredibly well stocked.
Looking at the figures from trust pilot seems great but the original mattress now selling at less than 50% off what it was selling for this time last year and this mattress represents or did 60% of sales . So as for returning custermers to the brand let's hope they will buy the new products or else this is a spiral down from here?
Personal as a returning custermer I kept to the ordinal great product,
An struggling to see where the profit is here or where it is coming from more let's hope it's a good Q4 for Eve but must say the price war is more intense than ever.
I've have just moved in to this stock. Did anyone notice out that Eve has the highest rated mattress* in Which? magazine reviews and makes 4 out the the 15 top Best Buys. Quality.
*Which? verdict on Eve Premium Hybrid Mattress:
"This is an outstanding mattress that aced most of our tough tests. It’s supportive, stable and long-lasting, and a definite Best Buy. In fact, it’s the best mattress we’ve seen in years."
The major win for Eve is the exposure of the brand as a sleep brand to large audience of mattress buyers in a subliminal way and not just a bed in a box company, although obviously that is the big margin product. Connecting high quality sleep products with the mattress will raise its brands value and therefore people will be willing to pay a little more, same argument you pay more for one brand than a another, even if you have not seen it. Expectation is of higher quality. Products i saw look great and very well produced so that bodes well. Shares will continue the march forwards as re-rate continues.
Hi martin,
CC both in the 6 month report and the 3rd sept rns referred to annual sales of £22m. so it takes into account the most up to date figures she had available beyond the first half. All I am saying about profit, is that clearly it is close but as of the latest report, its not there yet. It seems, all being equal it probably will be this year, but this is not normal times, and therefore a higher degree of uncertainty exists around forecasts.
I said at the time of the Boots announcement that it was a good thing for Eve, but it remains to be seen how it pans out.
I also think that for the Sp to have gone form around 1.2p to 4.5p in matter of just a few months is fantastic and reflects all the positives we have discussed over these last months. All I am saying now is that in my opinion, further SP growth is likely to be muted, short of an offer or obvious stake building leading to maybe an offer.
Its all good presently, but I fear it will be just a bit too slow for my taste.
But you guys have turned me around before so I am going to keep reading the posts because you never know where the next opportunity may come from. GLA
Wrt the theory that CC published the RNS to tame SP growth expectations... @wyndrum I completely disagree and think you're missing a key point. The RNS upgrading the yearly revenue expectations does so based on very strong trading in July and August, which are NOT included in the HALF YEAR final results that came out a few days later. We have no numbers on those months yet, but based on the fact that May and June were finally profitable and that Jul&Aug prompted an expectations upgrade, I'm very confident we're now at the profitability level you say it's so far away.
On a different note, I think the Boots move is brilliant. The impact on revenues/profit will likely be small, but even if it just broke even, it's huge brand exposure precisely to the most important target customer group, and one that is hard to tap into for an online-only business.
Sorry OWJ, I thought we were musing over just the Boots offerings.
My mistake
@wyndrum - Don't exaggerate.
They do return to buy other stuff - The customer repeat rate has been steadily rising, this has been specifically referenced in more than 1 RNS statement.
It's not just about mattresses is it? EVE sells a whole range of products and intends to increase it's range further, this is the entire point of their new strategy. A bed is generally a one off purchase - Pyjamas, bed sheets, and pillows are not.