Interim Results16 Oct 2019 15:08
Business Highlights
-Sales of non-mattress products now contributing 24% of revenues (H1 2018: 21%)
-Customer repeat rate increased to 19% (H1 2018: 16%)
-Marketing efficiency improved in all markets and whilst revenue was lower the marketing contribution has improved by
£2.3m
-Conversion rate up 20 bps reflecting upgrades to the customer journey
-Raised £11.7m net of expenses in new equity and £0.9m in advertising credits from Channel Four
Post Period End
-Retail partnership with Next Home expanded in August 2019 by 104 stores to cover 158 sites
-Three new retail partnerships announced in July 2019: Argos now live alongside Dunelm with Homebase due to launch
imminently
-Unprompted brand awareness in the UK&I grew from 10% in January 2019 to 15% in August 2019 (ahead of all D2C
competitors), with awareness also up in France on the back of a new marketing campaign launched in June 2019
-Signed deal with British Rowing to be their official sleep partner
Current trading
As set out in the Company's trading update of 20 September 2019 eve has revised revenue guidance for the current financial year to between £25m and £27m as a result of the worsening macro-economic conditions and near permanent heavy discounting by competitors. The revision in revenue expectations is expected to have some flow through to the EBITDA loss, though a substantial year-on-year reduction in H2 losses and the full year loss is still expected.
James Sturrock, CEO of eve Sleep, commented:
"We are making good progress with our strategic focus to build a sleep wellness brand, as a key differentiator to peers and to secure the foundations for a profitable and sustainable future for eve. There has been a step-up in the depth and breath of product ranges, a 50% increase in brand awareness and improvements to our technology and systems to ensure the best experience for customers, all of which have driven a meaningful improvement in the customer repeat rate. In tandem, costs and cash are better managed, which is evident in the H1 reduction in losses and the cash outflow.
While the headwinds have increased, we have a flexible and adaptable business model, alongside a strategy that will clearly differentiate eve in the longer term from peers. We will continue to focus on the rebuild strategy through a combination of organic improvements and inorganic opportunities as and when they arise."
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