Warpaint London's sales already topping pre-Covid performance
Warpaint London’s performing better now that it was pre-Covid, the UK-based specialist beauty products supplier said after releasing its half-year results on Wednesday.
The company, which owns the W7 and Technic brands (but has no connection with men's make-up line War Paint), said business had “significantly improved” in the first half of 2021.
Citing major supply deals with key retailers Tesco and Wilko, chief executive Sam Bazini said Warpaint has also seen “particularly strong” growth in the UK, “with sales increasing beyond the level achieved in the first half of 2019, a period before the pandemic hit”.
After launching in Tesco in June 2020 through 56 stores, its W7 brand is now available through over 1,300 of its stores, with further expansion planned with the supermarket chain for later this year. In addition, W7 products will be launched in health & beauty retailer Boots early in 2022, through an initial 84 stores.
And abroad? Warpaint said it has seen a “much improved” performance in the US (helped by further product expansion with W7 now stocked in over 1,000 Five Below stores) allied by “strong growth elsewhere internationally and a rapid increase in online sales”.
So how did those positives translate into numbers? Group sales increased 36% to £18.4 million in H1, up from £13.5 million in the corresponding H1 2020 period and almost matching the £18.9 million recorded in 2019.
UK revenue for the six months increased 31% to £8.9 million (2020: £6.8 million, 2019: £7.8 million) while international revenue rose 41% to £9.5 million (H1 2020: £6.7 million, 2019: £11.1 million).
Online sales also continue to accelerate in the UK and the US, with an increase of 115% in e-commerce sales in H1 2021 compared to a year ago. Warpaint also expects further online expansion with the launch in China of official W7 brand stores on Taobao Mall and Xiaohongshu shopping platforms.
Adjusted EBITDA rose to £2.1 million from £0.4 million a year ago and matched the performance in 2019. The gross profit margin of 34.5% fell slightly short of the 35.1% in the previous year and the 34.9% in 2019, with Warpaint noting performance was against the backdrop of “supply side price inflation and significant increases in freight costs”.
The company also said it’s now debt free and had cash-in-hand of £6.7 million at 30 June ahead of the £3.8 million last year and the £3.7 million in 2019.
Warpaint said the future looks positive too. Currently, the group holds a “significant” Christmas order book of £8.7 million, up on the £7.7 million of a year ago.
"Warpaint is a global business with the capacity, expertise and strategy, coupled with balance sheet strength, to drive future growth”, added Bazini.
“We are working in partnership with our existing retailers to grow sales further and are in active discussions with additional major retailers in the UK and overseas. We have significant opportunities for further growth and I look forward to the remainder of the year and into 2022 with confidence.”
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