Supreme Plc Regulatory News (SUP)

12 April 2022

Supreme plc

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

Year End Trading Update

Supreme (AIM:SUP), a leading manufacturer, supplier, and brand owner of fast-moving consumer products, provides a trading update for the twelve months ended 31 March 2022.

Supreme performed strongly throughout FY22, driving organic growth across its core categories, completing two strategic acquisitions financed by free cash and establishing product traction with leading UK grocery customers.

The Company expects to report revenue in excess of £130 million (2021: £122 million) and Adjusted EBITDA1 of no less than £21 million for the year (2021: £19.3 million).

The Vaping division is expected to report 10% revenue growth owing to new listings with Sainsbury's and Morrisons as well as continuing growth across all of its discount retail customers. This result will be enhanced by increases to its gross margin profile driven by further manufacturing gains. With increasing levels of government support for vaping, the Group expects the double-digit revenue growth for this category to continue.

The Batteries and Lighting divisions have continued to show their defensive characteristics and are expected to report growth in revenue of around 2% and 5%, respectively, and higher rates of gross margin as a percentage of sales when compared to 2021, highlighting the Group's buying power and increasing breadth of distribution.

The Sports Nutrition & Wellness division has continued to demonstrate its potential with excess of 100% revenue growth. However, raw material price inflation, particularly recently in relation to whey powder, has impacted profitability.

Outlook

Looking at FY23, the Group is expecting to deliver another year of profitable growth and increasing levels of cash generation, predominantly driven by Supreme's strong Vaping sales footprint. However, this performance will be tempered by commodity price inflation within Sports Nutrition & Wellness and the increases in the overhead base relating to wage and transport costs. Management has already taken steps to mitigate the external factors, including buying forward whey, and will also be continually reviewing potential price increases and ongoing manufacturing and distribution rationalisation.

The Group remains fully focused on driving organic growth, closely balanced with strategic acquisitions, having agreed a new £25 million RCF facility with HSBC in March 2022.

The Board remains confident that the Group will continue to deliver both organic and acquisition led growth this financial year and beyond.

The Group will publish its financial results for the year ended 31 March 2022 in July 2022.

Enquiries:

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.

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.

https://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 IPO-related costs).