Warpaint London PLC Trading Update (5669X)

TIDMW7L

RNS Number : 5669X

Warpaint London PLC

20 December 2019

20 December 2019

Warpaint London PLC

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

Trading Update

Change of Executive Director Positions

Warpaint London plc (AIM: W7L), the specialist supplier of colour cosmetics and owner of the W7 and Technic brands, provides an update on the trading performance for the year ending 31 December 2019 and announces a splitting of the positions of the Joint Chief Executives.

Trading Update

The Company's board is pleased to announce that it currently anticipates that Group sales for the financial year to 31 December 2019 will be approximately GBP50 million, in line with the guidance provided in the Company's trading update on 6 August 2019.

As the Company has previously outlined, a number of factors, including the geographic mix of sales, adverse exchange rate movements and the Group's investment in its strategy for future growth, particularly in the US, are having an impact on profitability in the current financial year. Consequently, the Company's board currently expects adjusted profit before tax for the year ending 31 December 2019 (excluding amortisation in connection with acquisitions, share incentive scheme costs and exceptional items, which the board expects to total approximately GBP2.8 million) will now be in the range of GBP5.1 million to GBP5.5 million.

Exchange rate movements in recent months have had a negative impact of approximately GBP250,000, from a translational perspective, on profitability since the Company's last update in September 2019. This, coupled with further negative margin impact, has led to this reduction in the expected adjusted profit before tax for the current financial year from the previously anticipated range of GBP6 million to GBP7 million.

Change of Executive Director Positions

Following a review of the senior roles within the Company it has been decided that from 1 January 2020 the positions of the Joint Chief Executives will be split, with Sam Bazini remaining as Chief Executive and Eoin Macleod being appointed to the newly created position of Managing Director, reflecting his more operational focus. Both Sam Bazini and Eoin Macleod remain significant shareholders and as executive directors of the Company on its board.

Commenting, Clive Garston, Chairman of Warpaint, said: "I am pleased that we anticipate reporting sales for the current financial year in line with the guidance we provided in August. Whilst the unprecedented volatility in exchange rates in recent months has had a negative impact on the profits of the Company, both from a translational and margin perspective, I am pleased by our overall trading performance.

"Following a review of the roles being undertaken by our Joint Chief Executives we have decided to formally split the role. Sam and Eoin have always split the Chief Executive role so that they have distinct responsibilities within the Company, but with the Company's growth and diversification since admission to AIM we think these new positions are now an appropriate way to formally reflect this.

"With the Company's robust balance sheet, profitable trading performance and strategy for growth we continue to look forward to the new year with confidence."

Enquiries:

 
 Warpaint London                                  c/o IFC 
  Sam Bazini - Joint Chief Executive Officer 
  Eoin Macleod - Joint Chief Executive Officer 
  Neil Rodol - Chief Financial Officer 
 
   Shore Capital (Nominated Adviser and Joint 
   Broker) 
   Antonio Bossi - Corporate Advisory 
   Fiona Conroy - Corporate Broking                 020 7408 4090 
 N+1 Singer (Joint Broker) 
  Shaun Dobson - Corporate Finance 
  Alex Bond - Corporate Finance 
  Mia Gardner - Corporate Broking                 020 7496 3000 
 
   IFC Advisory (Financial PR & IR) 
   Tim Metcalfe 
   Graham Herring 
   Florence Chandler                                020 3934 6630 
 
 

Warpaint London plc

Warpaint London plc is made up of two divisions.

The largest division sells cosmetics under the lead brand names of W7 and Technic. W7 is sold in the UK primarily to discount retailers and internationally to local distributors or retail chains. The Technic brand is sold in the UK and the rest of Europe with a significant focus on the gifting market, principally for high street retailers and supermarkets. In addition, this division supplies white label cosmetics produced for several major high street retailers. The Group also sells cosmetics using the smaller brand names of Man'stuff, Body Collection, Vintage, Outdoor Girl, Very Vegan, Chit Chat, Smooch, Copy Cat and Taxi.

The second division trades in close-out and excess stock of other branded cosmetics and fragrances from around the world.

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 [e-mail] or visit www.rns.com.

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December 20, 2019 02:00 ET (07:00 GMT)