Trading Update and FYE 2022 Results Date
19/01/2023 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230119:nRSS1971Na&default-theme=true
RNS Number : 1971N S-Ventures PLC 19 January 2023
19 January 2023
S-Ventures PLC
("S-Ventures", the "Group" or "Company")
Trading Update, 2022 Results Date & Business Segment Reporting
S-Ventures PLC (AQSE: SVEN) (OTCQB: SVTPF), a company investing in and growing
exciting brands across the natural, wellness and food-tech category, is
pleased to issue a trading update in respect of the financial year ended
("FYE") 30 September 2022 ("FYE 2022"), the audited results of which, are
expected to be published in full on, or around, 28 February 2023.
S-Ventures was formed to identify investment opportunities within the natural,
wellness, food-tech, organic and vegan snacking sectors within the UK and
Europe that have the potential for further development through the knowledge
and expertise of our management team. The performance of each brand within the
Group reflects the different phases of growth each has experienced, however,
we continue to make good overall progress throughout our product range towards
achieving greater results.
The Group FYE 2022 performance
Revenues for the FYE 2022 were approximately £8.7m, with revenues recorded in
the second half of FYE 2022 being £4.6m, an increase of approximately 12%
from that of the first half of FYE 2022 of £4.1m. Revenue performance was
impacted by significant headwinds, particularly issues relating to the supply
of certain ingredients, including those supplies from Ukraine in Q2 and Q3 FYE
2022, which resulted in a loss of sales income. The total impact, an outturn
approximately 20% below the Group's initial targets, was slightly worse than
the 15% impact anticipated in our interim results release of 30 June 2022.
Since 30 September 2022, the impact of ingredient and labour supplies has
abated considerably, although the possibility of further disruption remains,
and recent trading has not been materially affected. Inflationary and exchange
rate pressures continue and we have passed on some price increases across the
Group to maintain margins. We continue to monitor our financial and trading
performance very closely.
The underlying operating losses before depreciation and acquisition costs for
FYE 2022 were approximately £2m, reflecting the impact of lower than expected
sales income, the impact on costs of lockdown-related labour supply issues,
and the general impact of inflation and exchange rates in Q1 and Q2 FYE 2022.
The losses include re-organisation and redundancy costs of c.£0.1m and the
initial losses from the acquisition of Lizza GmbH ("Lizza") of c.£0.2m.
Operating losses after depreciation and other costs are expected to be
c.£2.6m.
Recent acquisitions
We are delighted to have announced our most recent acquisition of Juvela, the
gluten-free and free-from baked goods brand. This acquisition is expected to
have a significant positive impact on the shape of our Group, operating
profitability and operating cashflow. The acquisition is also the culmination
of a busy year in terms of corporate actions, which included the following:
1. In March 2022, the acquisition of Livia, an indulgent plant-based
nutrition business
2. In April 2022, the acquisition of Market Rocket, a technology and
amazon D2C business
3. In August 2022, the acquisition of Lizza, a German factory and
free-from brand
4. In December 2022, the acquisition of Juvela, a gluten-free and free-from
bakery and pharma and retail brand
Business segment reporting and highlights
Going forward, given the larger scale of the Group, additional financial
information will be presented based on the following three separate sub-group
business segments:
i. Bakery: Juvela and Lizza (Sales in FYE 2022 - £0.1m)
ii. Plant-based nutrition: Pulsin, Livia's, Ohso, and Purely (Sales in
FYE 2022 - £8.1m)
iii. Technical services: Market Rocket (Sales in FYE 2022 - £0.4m).
Bakery
The new Bakery segment came into existence with the acquisition of Lizza in
August 2022. This business focuses on flax seed based keto products that fit
well with our other food brands. Strategically, Lizza gives us an important
market presence in the EU as a platform to generate income from overseas.
Lizza is currently loss-making and we envisage a turnaround period of 18
months as we reposition its product range and implement group synergies.
Subsequent to the FYE 2022, we have acquired Juvela, a profitable company that
sells a range of gluten-free products through both the pharma and retail
channels in the United Kingdom. We are exploring opportunities to deploy
Lizza's facilities for the supply of various group products presently
outsourced.
Plant-based nutrition
The Plant-based nutrition segment includes: Pulsin protein powders, sport
nutrition bars, keto products and healthy snack bars; Livia's indulgent
free-from treats; Purely plantain crisps; and, Ohso pro-biotic chocolate. All
products are free from gluten, palm oil and contain no artificial ingredients.
In FYE 2022, this segment faced economic headwinds and several trading
challenges. As a result, we have undertaken an internal restructuring
exercise, which includes the restructuring of leadership and employees'
positions, to enhance cost efficiency and profitability. These efforts are
bearing fruit and the turnover for the first quarter of FY23 has been
encouraging.
Technical services
The technical services segment, that includes Market Rocket ("MRL") which
provides a range of marketing and support services to third parties as well as
the Group, is currently performing above the Group's expectations since its
acquisition in April 2022. In October 2022, the Group invested through MRL
in a specialist team to enable MRL to provide a complete range of search
engine optimization (SEO), public relations (PR) and marketing services which
have resulted in both additional sales to existing customers and the
introduction of new accounts.
Future outlook
Our Board of Directors ("Board") remains optimistic about the business and
financial performance in the financial year ending 30 September 2023 ("FYE
2023") given the current progress in the implementation of our corporate
strategic plans.
Our Board and management team continue to look for new acquisition and
collaboration opportunities to take advantage of market conditions. However,
the Group's priorities are the consolidation of existing brands, integration
of new brands, roll-out of new product development, which has been delayed by
supply shortages last year, cost saving opportunities and synergistic plans to
further enhance profitability and top-line growth of the Group. The Board is
also considering a range of financing options to support the future growth and
development of the Group.
Our Board and management team remain dedicated to creating improved returns
and value for all our stakeholders and to capitalise on the market conditions
as we move into FYE 2023 across our Bakery, Plant-based nutrition and
Technical services platforms.
For further information, please contact:
The Company +44 (0) 1932 400 224
Scott Livingston (Chief Executive Officer)
Robert Hewitt (Chief Financial Officer)
AQSE Corporate Adviser and Broker: +44 (0) 20 3005 5000
VSA Capital
Andrew Raca - Corporate Finance
Evon Chan
Tolgahan Kuce
IFC Advisory (Financial PR) +44 (0) 20 3934 6630
Graham Herring
Tim Metcalfe
Florence Chandler
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END NEXXVLLFXFLFBBE