REG - Warpaint London PLC - Full Year Trading Update

Warpaint LondonAnnouncement

01/02/2022 07:00

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RNS Number : 2266A  Warpaint London PLC  01 February 2022

1 February 2022

 

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.

 

Warpaint London PLC

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

 

Full Year Trading Update

 

Strong 2021 trading and results expected to be ahead of market expectations

 

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
trading for the year ended 31 December 2021.

 

The Company announced in its trading update on 2 November 2021, sales for the
year ending 31 December 2021 were expected to be similar to those achieved in
2019 (2020: £40.3 million, 2019: £49.3 million), the most recent financial
year that experienced no impact from the Covid-19 pandemic.  Following
completion of the year, the Company is now pleased to report that unaudited
sales for the year ended 31 December 2021 have exceeded those achieved in 2019
at £50 million.

 

Gross margins for the year ended 31 December 2021 were maintained ahead of
those achieved in 2020 and 2019 at approximately 33.8% (2020: 31.1%, 2019:
33.5%), despite increased costs in the supply chain, particularly in respect
of freight.

 

For the year ended 31 December 2021, subject to audit, the Group's Adjusted
EBITDA*is expected to be approximately £7.7 million (2020: £4.2 million,
2019: £7.0 million) and Adjusted Profit Before Tax** (2020: £2.3 million,
2019: £5.2 million) is expected to be approximately £6.6 million, both of
which are ahead of market expectations.

 

The Company's cash balances as at 31 December 2021 totalled £4.1 million (31
December 2020: £4.9 million) and the Company had no debt, after significant
stock purchases to satisfy anticipated Q1 2022 demand.

 

The Group expects to release its results for the year ended 31 December 2021
in April 2022.

 

* Adjusted for foreign exchange movements, share based payments and
exceptional items.

** Adjusted for exceptional costs, amortisation of intangible assets, and
share based payments. Adjusted numbers are close to the underlying cash flow
performance of the business which is regularly monitored and measured by
management.

 

Commenting, Sam Bazini Chief Executive, said: "I am pleased to report that we
ended 2021 ahead of current market expectations.  In 2021 we enjoyed
particularly strong sales growth in the UK, significant growth internationally
and further increases in online sales.  It was pleasing that we were able to
maintain our margins at pre-pandemic levels, despite some inflationary
headwinds, particularly with freight costs.

 

"We expect to see a continuing improvement in performance in 2022 and have
started the year strongly.  In line with our stated strategy we have
significant opportunities for further growth, both with our existing
retailers, and those such as Boots where we are expecting to launch very
shortly, together with others that we are in discussions with.  I look
forward to providing further updates at the time of the release of the Group's
results in April."

 

Enquiries:

 Warpaint London                                                         c/o IFC
 Sam Bazini - Chief Executive Officer

 Eoin Macleod - Managing Director

 Neil Rodol - Chief Finance Officer

 Singer Capital Markets (Nominated Adviser & Joint Broker)               020 7496 3000
 Shaun Dobson, Tom Salvesen, Jen Boorer, Alex Bond - Investment Banking
 Shore Capital (Joint Broker)                                            020 7408 4090
 Patrick Castle, Daniel Bush - Corporate Advisory

 Fiona Conroy - Corporate Broking

 IFC Advisory (Financial PR & IR)                                        020 3934 6630
 Tim Metcalfe

 Graham Herring

 Florence Chandler

 

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.

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