20th Sep 2018 11:12
LONDON (Alliance News) - eve Sleep PLC on Thursday said its first half results were short of internal expectations and the company decided to refocus the business on its core markets of the UK & Ireland and France.
The mattress manufacturer also said that former Moonpig Managing Director James Sturrock will become chief executive officer from September 10. In July, Jas Bagniewski stepped down as chief executive on the back of a lower than expected sales performance.
As part of the refocus programme, the company has withdrawn from all other European territories and has commenced a cost savings progamme targeted across marketing and overheads as a result of the refocus on core territories.
The company has reduced its headcount by 20% and expects to record a restructuring charge of GBP800,000 for 2018 as a whole.
"As you would expect from a new CEO, James is conducting his own strategic and financial review of the business and I have no doubt given his experience and capabilities, more improvements will be forthcoming. The market opportunity remains undiminished and eve, as the most well-known direct to consumer sleep brand, continues to win market share," said Chairman Paul Pindar.
Shares in the company were trading 18% higher at 20.80 pence each on Thursday morning.
For the six months to June 30, the company recorded a pretax loss of GBP12.0 million, compared with a pretax loss of GBP9.1 million a year ago, due to higher administrative costs, which totaled GBP19.9 million versus GBP12.6 million.
Revenue jumped 63% to GBP18.8 million from GBP11.5 million. The company's core UK & Ireland and France business saw year-on-year revenue growth of 64% and 53%, respectively, in the interim period. Revenue in core markets in the first two months of second half has increased year-on-year by 40%.
The company, however, termed the revenue jump considerably below internal and market expectations. The shortfall was primarily due to over expanding into too many countries too quickly, without the necessary financial resources and management bandwidth to sustain the growth, eve Sleep said.
The London-listed company remains confident in building further on the strong platform developed in the first half in its core markets.
Related Shares:
EVE.L