26 September 2023

Supreme plc

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

AGM Trading Statement

Trading for FY 2024 now expected to be significantly ahead of market expectations¹

Supreme (AIM:SUP), a leading manufacturer, supplier, and brand owner of fast-moving consumer products, provides an update ahead of its Annual General Meeting ("AGM") at 8.00 a.m. today.

At the meeting, Paul McDonald, Chairman of Supreme, will make the following statement:

"Supreme traded strongly in the year ended 31 March 2023, delivering significant growth within our vaping activities, alongside solid organic growth across our remaining categories. We have continued to build on this positive momentum in the first half of the current financial year ("H1 2024") and are delighted to report that we remain on track to deliver our strongest financial performance as a listed company.

Supreme operates across an extensive customer network within the UK retail space, and, after broadening our already diverse product portfolio and investing in strategic brands, we remain well-positioned to further expand our UK market footprint and capitalise on opportunities within our own, private label and third-party brands.

Following record profitable growth in H1 2024, the Company now expects trading for the year ended 31 March 2024 ("FY 2024") to be significantly ahead of market expectations¹ with revenue guidance of around £195 - £205 million and Adjusted EBITDA² guidance of approximately £28 - 30 million, an increase of £3.5 million compared to the market expectations¹, with around £2 million of the incremental Adjusted EBITDA² arising from the Elf opportunity and around £1.5 million incremental Adjusted EBITDA² arising from the core business. In addition, the investment into working capital to support the Elf opportunity has been managed better than expected and as a result the Company now expects a stronger cash position at half year and year end than initially anticipated.

Management now anticipates the contribution of the distribution of Elf and Lost Mary brands across FY 2024, based on current legislation, will be around £4 million of Adjusted EBITDA² from around £40 million of revenue³.

In addition, the continued expansion of our Vaping category remains a key growth driver for Supreme and we continue to attract significant demand for our vaping products from key retailers, with demand across our principal 88Vape brand particularly strong. This increased demand combined with improved margins in our Wellness and Vaping category plus further synergistic overheads savings arising from the businesses acquired in FY23 have led to an increase in the full year Adjusted EBITDA² expectation for the core business of around £1.5 million.  

As an industry leader, Supreme acknowledges the wider concerns of youth vaping and remains fully supportive of any proactive measures or changes in legislation that potentially restricts specific products, packaging, flavours or point of sale in the UK.

Operationally, we have commenced activities from our new warehousing facility which has already enhanced our distribution and storage, further supporting both our organic and acquisitive growth ambitions.

The Board remains pleased with the Group's ongoing financial and operational strategic progress and believes we are ideally positioned to deliver on our medium to long term growth potential."

¹              Company compiled analyst consensus for the year ending 31 March 2024 prior to release of this announcement was Adjusted EBITDA of £25.6 million.

²              Adjusted EBITDA means operating profit before depreciation, amortisation, share-based payments charge, fair value movements on non-hedge accounted derivatives and exceptional items.

³              Previous guidance for the Elf opportunity was £25 - 30 million of revenue and around £2m of Adjusted EBITDA².

Enquiries:

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

About Supreme

Supreme supplies products across five key categories; batteries, lighting, vaping, sports nutrition & wellness, and branded household consumer goods. The Company's capabilities span from product development and manufacturing through to its extensive retail distribution network and direct to consumer capabilities. This vertically integrated platform provides an excellent route to market for well-known brands and products.

The Group has over 3,300 active business accounts with retail customers who manage over 10,000 branded retail outlets. Customers include B&M, Home Bargains, Poundland, Tesco, Sainsburys, Morrisons, Amazon, The Range, Costcutter, Asda, Halfords, Iceland and HM Prison & Probation Service.

In addition to distributing globally-recognised brands such as Duracell, Energizer and Panasonic, and supplying lighting products exclusively under the Energizer, Eveready, Black & Decker and JCB licences across 45 countries, Supreme has also developed brands in-house, most notably 88Vape and has a growing footprint in Sports Nutrition and Wellness via its principal brands Sci-MX and Battle Bites.

investors.supreme.co.uk/