Supreme Share Discussion Threads

[adamb1978] 24/4/2024 18:49

sharw - its difficult for him to say the opposite! I'm not bothered either way - I was responding to the point that private equity would take them out. More likely that it would be the CEO IMO given that, as I said above, he owns >50%.

[sharw] 24/4/2024 18:17

AdamB1978 - taking private keeps on being raised but this is not so - the CEO, who is the largest shareholder, knocked that on the head again and commited to the listing at the last presentation. Listen from here:

[elrico] 24/4/2024 17:11

Supreme PLC (AIM: SUP), a heavyweight in the fast-moving consumer goods arena, has triumphantly announced a stellar trading update for the fiscal year ending 31 March 2024. This sets the stage for a highly anticipated audit of the financial results that are revealed on 2 July 2024.

Supreme has reported an eye-popping performance for FY24, doubling its Adjusted EBITDA to a minimum of £38 million from the previous year’s £19.4 million and propelling revenues from £155.6 million in FY23 to around £225 million. This notable ascent in profitability is complemented by Supreme’s ability to conclude the fiscal year debt-free while generating unprecedented cash levels.

TTtps://smallcompanychampion.substack.com/p/surpeme-plc-fb3

[adamb1978] 24/4/2024 10:07

I'd have thought that the CEO taking it private is more likely than PE. He owns >50% today so could easily raise the debt to buy the remainder. Good thing is that he's not at the level of ownership where he doesnt need to get instis on board with a take out price so the company shouldnt be taken private without a decent premium

[s34icknote] 24/4/2024 09:54

Eps 20 p ?

[brummy_git] 24/4/2024 09:00

Another cracking trading update from FMCG/vaping products firm Supreme today.

All the news & commentary here.

[basem1] 24/4/2024 08:30

Would they also consider taking it private

[gb904150] 24/4/2024 08:28

If the market doesn't value this properly I suspect it will eventually get taken out by PE. Mega cash generator and then wouldn't have the inconvenience of being a listed PLC and the vaping scrutiny.

[adamb1978] 24/4/2024 08:22

Thanks for posting. Their target price is more or less bang on what I have for the next couple years.

Its on a PE of around 6x despite a very strong track record, zero debt, excellent cashflow etc. Feels too cheap

[edmonda] 24/4/2024 07:27

"Trading update highlights scale of growth"

In a Trading Update for the twelve months to 31 March 2024 Supreme expects to report revenue of c.£225m, and (adj.) EBITDA of at least £38.0m, in line with market expectations, which had been revised upwards during the course of the year and represents almost double the FY23 level. The Group closed the year debt free.

Our outlook highlights the extent to which Supreme has expanded, through both acquisition and organic growth during the period. From 2020 to 2024E the Group will have grown sales by 144%; Vaping +3.9x and all other Business Categories outside Vaping (Batteries, Lighting, Sports Nutrition & Wellness and Branded Distribution) +31%. Notwithstanding the impressive growth track record to date, the Group remains committed to complementary acquisition opportunities.

On the same basis, FY20-FY24E revenue will have grown at a 25% CAGR (FY20-FY25E, 20% CAGR) and (adj.) EBITDA at a 24% CAGR (FY20-FY25E, 15.1% CAGR).

The update shows the scale of Supreme’s growth in recent years with FY24 backed by organic revenue and profit growth across all divisions. Comparison of our FY25E outlook with a group of (18) companies representative of each of Supreme’s core Business Categories highlights the Group’s relative discount on a FY25E EV/(adj.) EBITDA 4.2x multiple compared to an overall average of 11.0x. Our Fair Value remains 225p/share, indicative of 7.5x FY25 EV/EBITDA.

Link to report:

[basem1] 23/4/2024 10:06

Must be due a full year TU this week compared to previous years I would not want to be out of the stock for that

[aishah] 22/4/2024 00:06

BBC News - Elfbar: Vape firm claims it will survive UK disposable ban

[dexterburt1] 26/3/2024 13:58

Finally moving again, with some decent volume.

[monet] 06/3/2024 16:52

No reason now why we shouldn't go back up to £1.30

[boonboon] 06/3/2024 16:44

A bit more detail. https://www.google.com/amp/s/amp.theguardian.com/uk-news/2024/mar/06/jeremy-hunt-tax-vaping-products-raise-tobacco-dutyAlso more money for enforcement which should help crack down on illegal vapes.Overall a positive for us I'd say.

[slopsjon2] 06/3/2024 14:27

"Duty to be introduced on vaping liquids for the first time in October 2026. A one-off increase in tobacco duty will be made at the same time."

[boonboon] 06/3/2024 14:23

Did tobacco go up straight away or not till 2026 either?If straight away could mean more people switch.

[dr biotech] 06/3/2024 13:47

Will be interesting to see how it will work. Vape liquid is mostly propylene glycol (not to be confused with ethylene glycol which is antifreeze) and a few flavours etc. Its not going to be that difficult to make your own - or buy the flavours and just dilute with the glycol. Its easy to tax tobacco as you can't grow your own leaf.

Thats probably one of the reasons why its going to take so long to implement.

[aishah] 06/3/2024 13:28

Yep, just backed up the truck here.

[dr biotech] 06/3/2024 13:26

Vape tax in Oct 2026. Thats kicked the can quite a long way down the road..

[dr biotech] 04/3/2024 15:32

From what I've read they want to tax it to put it out of the reach of children (and to squeeze milk vapers for what they can get). But its got to be cheaper than smoking. And have a way of controlling it. Probably won't be as bad a the drop in the share price suggests, but will take a while to find out.

[gb904150] 04/3/2024 14:03

Good points boonboon. In which case it will be interesting to see the detail.

As you say....some trading down so perhaps the overall effect is difficult to gauge.

One of the things I like with 88vape is they are a middle-aged vaper brand. I'd say those demographics aren't going to quibble over some price rises and are probably quite happy with their vaping choice.

Consolidation will be the main advantage. SUP have already shown their capability to integrate cuts ice and liberty flights seamlessly.

The downside are the low barriers to entry in the vaping market...but the extra regs also help the larger players.

[boonboon] 04/3/2024 13:58

Whilst I agree with the majority of this. I don't necessarily agree that it is the lower priced brands that will benefit.If it's like alcohol the tax will be per unit not on the resale cost.Let's assume it's £1 a unit. That will double the price of 88vape to £2 a 100% increase.A brand that currently sells for £4 will see it's price increase to £5 which is only a 25% increase.Now we might see some trade down to the lower cost brands which will benefit us. However as we also supply elf bar I think we've got good diversification across the price points.

[gb904150] 04/3/2024 13:36

I like that line Kevph "This secures future earnings as the govt gets in on the act and removes the armagedon scenario"

yes....the government want in on this vaping action. They want it for the taxes.

So now we have

Tiny vape co's who can't/won't comply with regs will get bought up and integrated.
Importers will be hit by vape import taxes. Favours domestic producers like us.
High cost vape brands (£4/10ml) will get hit.
Low cost vape brands (88vape) will benefit.
Big tobacco who want to buy us (need to rapidly increase revs from NGP's).
Big government who want to a share of our revenues via taxes.

Looks like a lot of tailwinds.

I think 88vape will get bought up eventually by big tobacco. It is an attractive way to acquire a large number of vapers quickly as well removing a threat from the market (low cost producer).

[kevph] 04/3/2024 12:24

Agree with all this. The big threat was to make Vapes prescription only IMO or outright ban. The fact there will be a tax is a huge positive. This secures future earnings as the govt gets in on the act and removes the armagedon scenario. Strange reaction really...