REG - Chill Brands Group - Trading Statement

Chill BrandsAnnouncement

07/12/2023 07:00

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RNS Number : 9546V  Chill Brands Group PLC  07 December 2023

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION
11 OF THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019/310.

7 December 2023

Chill Brands Group plc

("Chill Brands" or the "Company")

Trading Update

Chill Brands, the consumer packaged-goods distribution company, is pleased to
provide an update on its trading, focussed on positive developments around its
Chill ZERO nicotine free vapes and the Chill.com marketplace.

Highlights

·    Purchase of vape products by leading US retailer with launch into
seven new states.

·    Sales made to more than 475 independent retail stores since UK launch
during August 2023.

·    Late stage negotiations to place Chill ZERO products in a major UK
retail chain.

·    Expansion of e-commerce footprint with sales growth on Amazon.co.uk.

·    Growth of Chill.com marketplace platform with more than 40 external
brands listed.

Purchase of Vapour Products by Leading US Retailer

Chill Brands has received a purchase order for its nicotine-free vape products
from Smoker Friendly, the largest dedicated chain of smoke shops in the United
States. Starting in 2024, Chill ZERO products will enter an initial 60 stores
of Smoker Friendly's many US locations.

The agreement to launch with Smoker Friendly follows the Company's pilot phase
which provided initial sales data demonstrating clear consumer demand for
nicotine-free vape products. The pilot scheme saw Chill Brands' products enter
stores in Colorado, Arizona, Florida and Texas.

From early 2024, Chill ZERO products will be stocked by select Smoker Friendly
stores in Colorado, Wyoming, Montana, North Carolina, Florida, Missouri,
Arkansas, Tennessee and Indiana. These stores will carry all 13 existing vape
product variations across the 600, 1,500 and 3,000 puff ranges.

Sean Musgrave, vapour category director for Smoker Friendly, said: "We're
excited to work with Chill Brands and look forward to trialling the Chill ZERO
products. We are seeing demand grow with respect to nicotine-free vape
products. Our customers are looking for a product that has no nicotine, yet
still delivers the satisfaction of vaping, and I feel that Chill ZERO can
satisfy that request."

Growth of UK Retail Channel

Since releasing its vape products to the UK market during August 2023, Chill
Brands has now made sales to more than 475 independent retail stores
throughout the UK. These locations have been secured through the Company's
partnership with The Vaping Group and include franchised branches of Premier,
Spar and Nisa Local.

Having compiled four months of sales data, the Company is pleased to report
that it has observed a positive trend in reorder rates from independent
retailers. Stores placing reorders are doing so within around two months of
first carrying the brand (depending on their initial purchase amount),
reflecting continued demand for Chill ZERO nicotine-free vape products. The
Company will seek to maintain strong reorder rates and a rapid replenishment
cycle as it scales its distribution to new stores.

In addition to these independent stores, and as announced on 9 October 2023,
the Company has received an order that will see its Chill ZERO products
stocked in an initial 150 of WHSmith's 1,700 stores. Chill products are
expected to enter WHSmith travel stores in the near future and further
information will be provided following their ranging date.

In addition, Chill Brands is in advanced negotiations to place Chill ZERO in
another major UK retailer and will provide a further update upon confirming an
order, which is expected during December.

E-Commerce Update

As announced on 12 October 2023, Chill ZERO products are now available for
purchase by UK consumers on Amazon Prime. Since their launch on the platform
in late October, Chill ZERO listings have gained thousands of monthly views
with a sustained weekly increase in traffic and first page rankings for
'nicotine free vape' and other key search terms. Purchases have now been made
by more than 200 individual customers and the Company expects sales of its
products on the Amazon platform to continue to expand in 2024.

Further to announcements made during November 2023, Chill Brands has expanded
its B2B distribution network through product listings with leading wholesale
operators who have a combined reach of more than 9,000 business customers.
Flawless (www.flawlessvapedistro.co.uk (http://www.flawlessvapedistro.co.uk/)
) is the UK's leading distributor to category specialist vape stores, while
Vape Local (www.vapelocal.co.uk (https://vapelocal.co.uk/) , operated by
Phoenix 2 Retail) is one of the country's leading suppliers to convenience
store accounts. These listings are intended to facilitate new
business-to-business sales, introducing the Company's products to a wider
network of retailers.

The Company is pleased to note that its vape products are now carried by a
number of additional consumer-focused category specialist e-commerce sites
including oceanvape.co.uk, totally-vapour.co.uk, and royalvapes.co.uk. Certain
products are also carried by dyspensr.com in the United States. These product
listings serve to expose Chill Brands' products to a broad number of consumers
across different demographics and geographies, establishing brand recognition
and creating further sales opportunities.

Chill.com Marketplace Update

The Company has also seen substantial growth of its Chill.com marketplace
website which offers a curated collection of health, wellness and alternative
products. Chill.com now hosts 44 external brands between its US and UK-focused
subdomains.

Since Chill Brands' last update on the Chill.com marketplace, new brands
joining the US site have included NUBU infused Manuka honey, Peak State
nootropics coffee, Perfy superfood soda, AWKN hangover prevention supplements,
Hempress Hygienics female care products, and More Labs, the brand behind the
leading US electrolyte beverage Morning Recovery.

In the UK, new brands joining Chill.com have included Yumi chewable vitamins,
Quanna sexual wellness, Wild natural deodorants, and Goodrays, one of the UK's
leading CBD beverage brands.

Chill Brands continues to build a pipeline of new brands and products that
will periodically join the Chill.com website. During 2024, the Company intends
to execute numerous marketing campaigns and event activations with the
intention of driving new customer traffic to the growing website.

Callum Sommerton, Chief Executive Officer of Chill Brands, said: "The Company
has come a long way during 2023 and I am incredibly proud of the significant
milestones we have achieved. The coming months will see us take action on our
plans to expand the retail footprint of our Chill ZERO products, secure new
listings with major retailers, and further define our Chill.com marketplace as
a go-to destination for health and wellness including alternative products
featuring hemp, nootropics, adaptogens and other popular natural ingredients.

Having laid firm foundations from which to grow, I am confident that Chill
Brands has strong growth potential and we are keen to deliver value as we
seize the opportunities ahead of us."

-ENDS-

 

About Chill Brands Group

Chill Brands Group plc (LSE: CHLL, OTCQB: CHBRF) is concerned with the
development, marketing and distribution of wellness and recreational products
containing natural, functional ingredients. The Company's proprietary product
range is distributed by some of the most recognisable convenience retail
outlets in the US and includes nicotine-free disposable vapour products that
cater to the rapidly growing market for tobacco alternatives. Chill Brands
also operates the chill.com e-commerce website, on which it is building a
marketplace of products from third-party brands.

Publication on website

A copy of this announcement is also available on the Group's website at
(http://www.chillbrandsgroup.com/) http://www.chillbrandsgroup.com
(http://www.chillbrandsgroup.com/)

Media enquiries:

 Chill Brands Group plc                                      contact@chillbrandsgroup.com
 Allenby Capital Limited (Financial Adviser and Broker)      +44 (0) 20 3328 5656
 Nick Harriss/Nick Naylor/Lauren Wright (Corporate Finance)

Kelly Gardiner (Equity Sales)

 

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