Let’s lens through the financial performance of two FTSE AIM All-Share companies, eve Sleep PLC and YouGov PLC, which released their latest financial results and trading updates and apprised about the Covid-19 impact on their business.
eve Sleep PLC
eve Sleep PLC (LON: EVE) is an e-commerce company, which is into the business of household goods and home construction services directly to the customer. With the vision to deliver the power of sleep wellness to everyone, the company focuses on European sleep brand which sells and designs eve-branded mattresses and other sleep products. The company is registered in England and Wales and was previously known as eve Sleep Limited.
- Financial Highlights
For the fiscal year ended 31 December 2019, eve Sleep reported revenue of £23.8 million (2018: £29.4 million), reflecting a planned reduction of 19% year on year as the company optimised its DTC marketing while scaling back marketing investment to prioritise profitable revenues over revenue growth alone. However, the company successfully prioritised over its margin to achieve a growth of 70 bps in its gross profit margin, increasing from 52.8% (FY2018) to 53.1% (FY2019).
The Group’s underlying EBITDA loss reduced by 44 per cent or £8.5 million to the loss of £10.7 million in the FY2019 as compared to the corresponding previous financial year. The report stated that the reduction of 44.0 per cent in EBITDA loss represents the company’s increased focus on greater efficiency in marketing spend, profitable sales, a noteworthy drop in overheads and losses in the year 2018 with regards to the broader global footprint for part of the year.
As at 31 December 2019, eve had £8.0 million of cash and cash equivalents, £0.3 million of advertising credits available for use and no debt excluding the lease liability. The company successfully raised £11.7 million net of expenses in new equity during the reported year and £0.9 million in advertising credits from Channel Four in the 2nd month of the last year.
eve Sleep CEO, James Sturrock stated that the company has entered 2020 in good shape and holds a healthy net position of £7.8 million as at 29 February 2020 despite the wider market uncertainties.
Returns rate in core markets decreased by 40 bps to 8.9 per cent during the FY2019. The brand loyalty with the customer repeat rate increased by 230 bps to 16.7 per cent in the UK & Ireland whereas in France, it increased by 360 bps to 17.0 per cent during the FY2019.
- Impact of Novel Coronavirus
Amid coronavirus outbreak, the company expects to face some risk of reduced consumer demand as well as trouble in the supply chain that broadly depend on sourcing from China, the Far East and European countries. The company said that market ambiguity has increased in the first two weeks of March 2020, but it has yet not seen any noticeable impact on demand, operations and the supply chain. Moreover, the company confirmed some precautionary measures that it is taking to lessenthe impact on supply chain through the stronger stock holding of products which could ensure adequate coverage for the coming months.
- Share Price Performance - EVE
On 25th March 2020, at around 08:19 AM (GMT), by the time of writing this report, the stock of eve Sleep Plc was trading at a price of GBX 0.83 per share on the London Stock Exchange, a decrease in the value of around 2.35 per cent or GBX 0.02 per share, as opposed to the closing price of the stock on the previous trading day, which has been reported to be at GBX 0.85 per share.
The 52-week high of EVE stock price was recorded at GBX 10.48 on 18th July 2019 while its 52-week low was on 24th March 2020 at a price of GBX 0.65. The current share price was lower by 92.08 per cent from the 1-year high price. Also, the current share price was higher by 27.69 per cent from the 1-year low price.
As on 25th March 2020, the company’s market capitalisation was reported at GBP 2.24 Million with respect to the stock’s current market price. The free float and outstanding shares of eve Sleep Plc stood at 204.25 million and 263.45 million, respectively.
YouGov PLC (LON: YOU) is one of the prominent data and market research companies in the world. Listed on London Stock Exchange, the company provides syndicated research panels and data analytics services across South Asia, North Africa and the Middle East. More than half million people take part in its surveys throughout twenty-one countries, making it the trusted brands for businesses and media to offer an accurate portrait of what the world thinks.
- Financial Highlights and Trading Updates
On 24th March 2020, the company declared the trading update for the six months to 31st January 2020.
Revenue increased by 16 per cent to £76.9 million as compared to £66.5 million in six months of the year 2019 with an underlying business growth of 15 per cent. The revenue of Data Products & Services now represents 55 per cent of total revenue, increased by 17 per cent to £43.4 million during six months to 31st January 2020. The reported Revenue of Data Services increased by 3 per cent to £18.3 million during the six months, though were offset by reorganiation in the Nordics, non-recurring election work in Asia Pacific and lenient performance in Germany.
Adjusted operating profit increased by 35 per cent to £11.4 million versus £8.4 million in HY2019 with an underlying growth of 34 per cent. Adjusted operating profit margin rose by 2 percentage points to 15 per cent versus 13.0 per cent in HY 2019. Statutory operating profit increased by 13 per cent to £9.5 million as compared to £8.4 million in HY 2019.
The company reported strong cash conversion of 93 per cent during the six months to 31st January 2020. The cash balance increased to £27.2 million as compared to £25.0 million as at 31st January 2019.
YOU - Impact of Novel Coronavirus
As per the company information, there is no material impact on the company’s business to date from the novel coronavirus outbreak. However, the company confirmed that the condition seems uncertain over the coming months. In light of the current macro-economic ambiguity, the company is undertaking reviewing and contingency planning costs Further, the company believes that the impact of COVID-19 seems to be inevitable in terms of risk associated with clients’ default or longer payment periods.
- Share Price Performance- YOU
On 25th March 2020, at around 08:27 AM (GMT), by the time of writing this report, the stock of YouGov Plc was trading at a price of GBX 450.0 per share on the London Stock Exchange, an increase in the value of around 5.88 per cent or GBX 25.0 per share, as opposed to the closing price of the stock on the previous trading day, which has been reported to be at GBX 425.0 per share.
The 52-week high of YOU stock price was recorded at GBX 766.0 on 26th February 2020 while its 52-week low was on 19th March 2020 at a price of GBX 391.0. The current share price was lower by 41.25 per cent from the 1-year high price. The current share price was higher by 15.0 per cent from the 1-year low price.
The beta of the company’s stock has been reported at a value of 1.073, which shows that movement of the share is almost as volatile as the movement in the comparative benchmark index. The annual dividend of the company was reported at GBX 4.00 per share, and the annual dividend yield was reported to 1.00 per cent at the time of writing.
As on 25th March 2020, the company’s market capitalisation was reported at GBP 457.61 Million with respect to the stock’s current market price. The free float and outstanding shares of YouGov Plc stood at 98.22 million and 107.67 million, respectively.