Warpaint London plc (LON: W7L), the specialist supplier of colour cosmetics and owner of the W7 and Technic brands, has announced that its Annual Report for the year ended 31 December 2021, together with the Notice of Annual General Meeting, is today being posted to shareholders.
Financial Highlights
• Strong growth in sales, profitability and cash generation during the year reflecting the focus on growing sales of the Group’s branded products
• Group sales increased by 24.1% to £50.0 million in 2021 (2020: £40.3 million)
Ø UK revenue increased by 20% to £25.3 million (2020: £21.1 million)
Ø International revenue increased by 29% to £24.7 million (2020: £19.1 million)
• Gross profit margin increased to 33.8% (2020: 31.1%), against the backdrop of supply side price inflation and significant increases in freight costs
• EBITDA of £7.6 million (2020: £2.8 million)
• Adjusted profit from operations of £7.0* million (2020: £2.5* million). Statutory profit from operations of £3.8 million (2020 loss of £0.9 million)
• Reported profit before tax of £3.7 million (2020 loss of £1.1 million)
• Adjusted earnings per share of 7.8p* (2020: 3.1p*)
• Cash of £4.1 million at year end 2021 (2020: £4.9 million) after investment in additional inventory. Inventory at 31 December 2021 of £18.1 million (31 December 2020 £14.4 million)
• The Group was at 31 December 2021, and still is, debt free with the remaining loans and hire purchase contracts totalling £0.3 million having been repaid in full in April 2021
• Final dividend recommended of 3.5 pence per share (2020: 3.0 pence per share), bringing the total dividend for the year to 6.0 pence per share (2020: 5.8 pence per share, including a 1.3 pence special dividend)
Operational Highlights
• Further expansion in the number of Tesco stores stocking the Group’s products and the stocking of additional W7 product lines. W7 branded products now sold in over 1,400 Tesco stores in the UK
• Further product expansion in the US, including W7 products now being stocked in over 1,200 Five Below stores. New sales team in place in the USA to drive growth in the largest colour cosmetics market in the world
• Online sales continue to accelerate, with an increase of 159% in Group e-commerce sales in 2021 to account for 2.7% of Group sales (2020: 1.3% of Group sales)
• Further expansion of online sales presence with the launch in China of official W7 brand stores owned by the Group on Taobao Mall (Tmall), the most visited B2C online retail platform in China and Xiaohongshu (Red), one of China’s foremost social media, fashion and luxury shopping platforms. We now have 15 online distributors in China
• The Group’s expansion strategy continues with active discussions being held with additional major retailers in the UK and internationally
Post-Period End Highlights
• Successful launch in Boots of 45 W7 products in an initial 80 stores in February 2022
• Record trading experienced in the first quarter of 2022 – Group sales for the first three months of 2022 approximately 60% ahead of the same period in 2021, with sales increases seen across all the Group brands
• Gross margin continued to improve in the first quarter of 2022 versus both Q1 2021 and the full year 2021
• Six new accounts opened in the USA, including CVS, where a significant Christmas 2022 order has also been received.
You can read the full report here:
Warpaint London 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.
