(Alliance News) - Warpaint London PLC on Wednesday said its due to launch in Boots stores as the cosmetics supplier swings to interim profit on higher sales.
Shares in Warpaint were trading down 2.7% at 211.25 pence each in London on Wednesday.
The budget cosmetics company swung to a pretax profit of GBP166,000 in the first half ended June 30, from a GBP1.5 million loss last year. Before the pandemic, Warpaint posted a GBP210,000 pretax loss in the first half of 2019 and interim profit of GBP1.3 million in 2018.
Revenue returned to pre-pandemic levels for the owner of the W7 and Technic brands, jumping 36% to GBP18.4 million in the first half from GBP13.5 million the year prior. In comparison, the company noted interim revenue of GBP18.9 million and GBP18.4 million in 2019 and 2018 respectively.
Nottingham, England-based health and beauty retailer Boots have agreed to stock W7 brand at an initial 84 stores from February 2022 onwards, the company said.
Sales of Warpaint's lead brand, W7, grew 59% year-on-year to GBP10.5 million from GBP6.6 million. At the half year point, W7 sales accounted for 57% of overall revenue.
W7 products can now be found in 1,300 Tesco stores, compared to only 56 stores in June 2020. Tesco held a UK market share of 27% as of August 8.
Affordable colour cosmetics remain its priority the company said. Cosmetics sales accounted for 88% of revenue in the first half compared to 82% last year.
In the US, W7 branded products are now stocked in over 1,000 branches of discount store Five Below. The company hopes to expand its overseas sales with the launch of W7 products on the popular Chinese e-commerce platforms Taobao Mall and Xiaohongshu.
Chief Executive Sam Bazini said: "We have seen particularly strong growth in the UK, with sales increasing beyond the level achieved in the first half of 2019, aided by the growing sales of our W7 brand through Tesco and of our Technic and Body Collection brands through wilko, with a further expansion of the W7 range in Tesco planned for later this year. Additionally, the planned launch of W7 into Boots provides a further significant opportunity. We have also seen a much improved performance in the US, strong growth elsewhere internationally and are seeing a rapid increase in online sales."
Warpaint reported an interim dividend of 2.5p, compared to 1.5p in 2020. However, the company noted that it did issue an additional 1.3p payout last year to compensate for a lack final dividend in 2019.
Full-year results are expected to be weighted towards the second half, the company noted, due to income from gifting. As of June 30, Warpaint said it has secured a Christmas order book worth GBP8.7 million.
By Scarlett Butler; scarlettbutler@alliancenews.com
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Warpaint London (W7L)