Warpaint London plc (LON:COG) Chief Executive Officer Samuel Bazini caught up with DirectorsTalk for an exclusive interview to discuss interim results, new accounts in the US & the launch of W7 into Boots, further developments and what we can expect from the company for the rest of the year.
Q1: First off, congratulations on a fantastic set of results that you released. Could you just start taking us through the highlights of the first six months?
A1: Well, for me, the biggest highlight is the growth of the business in the first half of 2022, record turnover of £25.25 million, 37% percent up on the same period of last year. What’s interesting to know, people forget that last year, the first three months, we were locked down so you’d expect to be ahead but actually against 2019, the last non-COVID year, we’re 33% up so this is genuine growth.
Our adjusted profit before tax is also up to £4.8 million against £1.6 million in the same period of last year and all this growth has been achieved and improved margin despite all the current inflationary pressures we’re experiencing in the UK.
We’ve also seen exceptional growth across all our brands, both here in the UK and in Europe and this growth has been driven not just by new accounts, but also by our existing customer base, which is very, very pleasing for us.
Q2: Now, over the period, Warpaint London has successfully launched into Boots, opened new accounts in the US and performed well online. Could you tell us more about these wins and what it’s added to the group?
A2: The W7 brand in Boots has been performing very well since the launch earlier this year. Obviously, as well as helping to increase our revenues, it’s also hugely important for our W7 brand to be in the largest cosmetic retailer in the UK.
With regard to the US, there’s not much to add to the announcement we made earlier in the year. We opened up six new accounts for seasonal gifting, one of which was CVS, and we are currently in the process of delivering these orders, so I’ll update you next time we talk.
Online sales are up 44% against the same period last year and should this rate of growth continue into the second half of the year, which we fully expect it to do, we should achieve revenues of around £2 million. Like the rest of the business, our eCommerce is run profitably, so it will not only help revenues, but it will also help the profitability of the business. We make sure a lot of people combine cash and online sales, we make sure that part of our business remains profitable.
Q3: Post 30th of June, you’ve highlighted further progress, could you just talk us through these further developments?
A3: Well, we started the second half strongly, so much so that we had to upgrade our forecast for 2022, and we now expect revenues to be £61 million and an adjusted profit before tax in excess of £9 million.
In addition to this, we’ve opened up two new significant accounts in the US, we’ve got 96 products going into 280 H-E-B stores, which is a large grocery store in Texas, somebody tells me they are the largest independent grocer in Texas. We’ve also got 60 cosmetic products going into 190 CVS stores in January 2023 so we’ve opened up 470 new doors in the US which is very exciting for us.
Q4: I see that you’ve decided to award all of your staff a £1,000 payment to help really with the cost of living increases. Can you tell us more about that and the thinking behind it?
A4: The thought process behind this decision is really quite simple. We always feel a happy workforce equals a happy and productive business, and as a company, we always try and do the right thing by our staff. I have to say, it’s been very well received in the offices this morning.
Our staff do an exceptional job for us, and we’re having an outstanding year. We know there are some large cost of living increases coming down the line, particularly with energy bills, and we felt it was only right and fair to try and help as much as possible with the increased costs that all our staff are going to face in the coming months.
Q5: Just looking forward then, what else can we expect to see from Warpaint London for the rest of the year?
A5: As I mentioned earlier, we’ve just upgraded our numbers for 2022 to £61 million for revenue so we’ll be concentrating on achieving this number and if possible, really trying to exceed it.
Our main focus for the rest of the year is really to prepare now for 2023. We’re in advanced talks with a number of large retailers, both in the UK and abroad, and really, we’ll be looking just to finalise the contracts this year so we can look forward to further growth in 2023.