Tue, 07 Jun 2022 | BUSINESS SALE
Eve Sleep, a publicly traded mattress company, has announced that it is seeking a buyer to take the business private once again, after revealing that it is set to miss its revenue targets for this year. The business is seeking either a new owner or majority investor as it looks to expand into the “sleep wellness” market.
Eve Sleep went public five years ago, but since then has seen its share price fall from over 100p to its current value of less than 2p. The company has said that its performance is being heavily impacted by poor consumer confidence, along with high inflation.
In the five months to the end of May 2022, Eve Sleep’s sales in the UK and Ireland were down 15 per cent from a year earlier. However, the company claims that this still keeps it ahead of the wider industry, which saw a 29 per cent year-on-year drop in the UK.
As a result of these pressures, the company’s board says it is now in the business' best interests to explore strategic and financing options, including external investment and a potential sale.
The company said: "Eve is, like all direct to consumer businesses, exposed to ongoing weaknesses in the economy, declining consumer confidence and rising inflation, both in the wider consumer landscape and in input prices. These headwinds are slowing Eve’s progress toward its strategic and financial goals."
The company said it had been in discussions with a potential US investor who had reportedly been interested in taking the company private. However, these discussions are now reported to have lapsed, with the investor said to no longer be interested.
In a statement to shareholders, the board said: “Having delivered a third consecutive year of growth in revenues and marketing contribution in our core UK & Ireland business in 2021, and cognisant of current trading conditions, the board now wishes to accelerate Eve’s push into the wider sleep wellness space. In order to deliver our objective of creating the first digital sleep wellness retailer, the board considers that Eve would benefit from additional investment.”
In its most recent financial results, for the full year 2021, Eve Sleep reported group revenues of £26.6 million, up by £1.4 million from a year earlier, with gross profit increasing slighty from £14.4 million in 2020 to £14.7 million last year. However, the group’s post-tax losses grew from £2 million in 2020 to £3.1 million.
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