Supreme Plc Regulatory News (SUP)

4 May 2021

Supreme plc

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

Trading Update 

- Strong performance across key growth categories

- Adjusted EBITDA ahead of expectations

Supreme (AIM:SUP), a leading manufacturer, supplier and brand owner of fast-moving consumer products, provides a trading update for the year ended 31 March 2021.

The Company performed strongly throughout the period, generating high levels of demand across all its core categories, which include batteries, lighting, vaping, sports nutrition & wellness, and branded household consumer goods. This excellent performance, delivered against the backdrop of the Covid-19 pandemic and the associated restrictions, reinforces the Company's resilience, the strength of its brands and the importance of its diverse routes to market and extensive retail network including 3,300 active accounts across wholesale, discount, supermarket, high street, international and public sector customers, in addition to 70,000 active online accounts.

For the year ended 31 March 2021, Supreme expects to report a c. 30% increase in revenues to at least £121 million (2020: £92.3 million), in-line with management's expectations, and anticipates delivering Adjusted EBITDA1 slightly ahead of expectations of at least £19 million (2020: £16.2 million), an increase of c. 20%. Movements in Group margin reflect the changes in revenue mix following the acquisition of Provider Distribution in February 2020 which are partially offset by stronger growth in higher margin products in Vaping and Sports Nutrition & Wellness.

The Group remains highly cash generative, with net debt at 31 March 2021 of approximately £5.1 million (31 March 2020: £18.7 million).

The Group also maintained high levels of business continuity throughout the year, both at its manufacturing site and across its distribution network, whilst adhering to government guidelines and prioritising the health and safety of its employees.

Specifically, the Group benefitted from significant demand across Vaping and Sports Nutrition & Wellness during the year, delivering a 35% increase in revenues in its Vaping division with its 88Vape brand continuing to achieve strong customer traction, as demonstrated by the recent announcement regarding its roll-out across McColl's entire store estate. Furthermore, the Group's Sports Nutrition & Wellness category delivered 38% growth underpinned by the success of the acquisition of Battle Bites protein snack bars in October 2020, the expansion of the powdered protein range into meal replacements under the Solo brand and the early success of private label vitamins, which will be further complemented by additional product launches later this year.

The board and management of Supreme continue to monitor the Covid-19 situation very closely and remain confident in the outlook for the business this financial year and beyond. 

Sandy Chadha, Chief Executive Officer of Supreme, commented:

"I am delighted to provide our first trading update since our AIM admission in February 2021. We continue to build on our strong track record of growth, with our strategy to focus on high growth categories such as vaping and sports nutrition really coming to fruition.

"Innovation and entrepreneurship continue to be at the heart of what we do and our exciting pipeline of new products, coupled with the potential to increase the penetration of our existing categories, continues to be underpinned by our market leading distribution network.

"The new financial year has started well and we are looking ahead with confidence on delivering on our expectations."

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

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About Supreme

Supreme supplies products across five key categories; batteries, lighting, vaping, sports nutrition & wellness, and branded household consumer goods. The Company's capabilities span from product development and manufacturing through to its extensive retail distribution network and direct to consumer capabilities. This vertically integrated platform provides an excellent route to market for well-known brands and products.

The Group has over 3,300 active business accounts with retail customers who manage over 10,000 branded retail outlets. Customers include B&M, Home Bargains, Poundland, The Range, Sports Direct, Londis, SPAR, Costcutter, Asda, Halfords, Iceland and HM Prison & Probation Service.

In addition to distributing globally-recognised brands such as Duracell, Energizer and Panasonic, and supplying lighting products exclusively under the Energizer, Eveready and JCB licences across 45 countries, Supreme has also developed brands in-house, most notably 88Vape and has a growing footprint in Sports Nutrition and Wellness.

www.investors.supreme.co.uk

1 Adjusted EBITDA means operating profit before depreciation, amortisation, share-based payments charge, fair value movements on non-hedge accounted derivatives and exceptional items (including all IPO-related costs)