Last checked at 12 Apr 2022 07:00
12 April 2022
Warpaint London PLC
("Warpaint", the "Company" or the "Group")
Trading Update and Notice of Results
Strong trading performance continues into Q1 2022
Warpaint London plc (AIM: W7L), the specialist supplier of colour cosmetics and owner of the W7 and Technic brands, is pleased to announce an update on current trading ahead of the release of the Company's results for the year ended 31 December 2021 on Tuesday 26 April 2022.
Trading Update
As outlined in the Company's 'Full Year Trading Update' announced on 1 February 2022, the Group experienced strong 2021 trading. The Company is pleased to report that this positive momentum has continued in the first quarter of 2022. Group sales for the first three months of 2022 are approximately 60% ahead of the same period in 2021, with sales increases seen across all of the Group's brands.
Gross product margin has also improved in the first quarter of 2022, against the level achieved in the year ended 31 December 2021, despite increased costs in the supply chain, particularly in respect of freight.
Sales of the Group's W7 branded products through Tesco stores continue to perform well, with more stores and space being allocated to the Group across the Tesco estate. In February 2022, the Group successfully launched 45 W7 products in an initial 80 Boots stores and the brand is performing in line with Group management's and Boots' expectations. The Group has also secured a significant contract with a further major UK grocer to produce a range of all year-round products and Christmas gifting.
Warpaint's activities in the USA continue to grow, aided by the Group having taken on a number of experienced US based salespeople, resulting in six new accounts being opened in the US and several Christmas gifting orders being received from new customers, the most notable being a significant order from CVS to be delivered in September this year.
Online sales continue to accelerate and for the first quarter of 2022 were 29% ahead of the same period in 2021. The growth in online sales has been aided by sales of the W7 brand in China, following the launches in 2021. Online sales in China are growing month on month and the board believes that over the next 18 months online revenues in China will make a meaningful contribution to the Group's online sales.
To aid the Group's focus on the environment and sustainability, including a drive to reduce plastics and manage the Group's waste, Kevin Laughton has been appointed as the Group's packaging technologist and sustainability lead. Kevin is an experienced technical packaging professional who will be focussed on ensuring that the Group not only complies with the increasing legislation in this area, but also that the Group embraces the challenges proactively and ensures the use of environmentally sustainable materials while focusing on the core Group strategy of producing affordable quality cosmetics.
An update on the outlook for the remainder of 2022 will be provided with the release of the results for the year ended 31 December 2021.
Investor Presentation
Warpaint's management will be hosting an online presentation and Q&A session on Tuesday 26 April 2022 at 5.30 p.m. BST. This session is open to all existing and prospective shareholders. Those who wish to attend should register via the following link and they will be provided with access details:
https://us02web.zoom.us/webinar/register/WN_RAnJgEoaSdiUqNkdO9yt0w
Participants will have the opportunity to submit questions during the session, but questions are welcomed in advance and may be submitted to: warpaint@investor-focus.co.uk.
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.
Enquiries:
Warpaint London Sam Bazini - Chief Executive Officer Eoin Macleod - Managing Director Neil Rodol - Chief Financial Officer
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Singer Capital Markets (Nominated Adviser & Joint Broker) Shaun Dobson, Tom Salvesen, Jen Boorer, Alex Bond - Investment Banking | 020 7496 3000
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Shore Capital (Joint Broker) Patrick Castle, Daniel Bush - Corporate Advisory Fiona Conroy - Corporate Broking
| 020 7408 4090 |
IFC Advisory (Financial PR & IR) Tim Metcalfe, Graham Herring, Florence Chandler | 020 3934 6630
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Warpaint London plc
Warpaint sells branded cosmetics under the lead brand names of W7 and Technic. W7 is sold in the UK primarily to retailers and internationally to local distributors or retail chains. The Technic brand is sold in the UK and continental Europe with a significant focus on the gifting market, principally for high street retailers and supermarkets. In addition, Warpaint supplies own brand white label cosmetics produced for several major high street retailers. The Group also sells cosmetics using its other brand names of Man'stuff, Body Collection, Very Vegan, and Chit Chat.