Source - Alliance News

Supreme PLC’s stock price soared on Monday after it said it expects to report an increase in annual revenue, although expecting a profit measure to fall, while its outlook for the current financial year remains strong.

Supreme is a Manchester-based firm that manufactures and distributes battery, lighting and vaping products. Shares were up 11% to 109.00 pence each in London on Monday morning.

In the financial year that ended March 31, the company said it expects revenue to rise 15% to at least £150 million from £130.8 million a year earlier.

However, it expects adjusted earnings before interest, tax, depreciation and amortisation to fall 8.5% to at least £19.3 million from £21.1 million.

Overall, Supreme said its financial 2023 performance will be ‘comfortably ahead of current market expectations’, noting a strong performance in the second half of the year. This was through delivering organic growth across its core business, supplemented by the earnings from the two vaping acquisitions completed in the first half of the year, it said.

Supreme’s Vaping unit saw revenue rise 72% to £75.0 million during its financial 2023 from £43.5 million a year earlier.

It added it was ‘encouraged to hear’ of the UK government’s ‘continued support for vaping as the ’most effective‘ smoking cessation tool, noting ’the launch its national ’swap to stop campaign’ where the government plans to provide vape starter kits to support one million adults to quit smoking over the next two years.‘

Looking ahead, Supreme expects to ’maintain its strong growth trajectory‘ during its financial 2024, predicting trading to be ’slightly ahead‘ of current market expectations, alongside confidence in delivering both organic and acquisition-led growth.

At March 31, it expects bank borrowings net of cash to have stood at neutral, a reduction of £12.9 million since the previous half-year end. This serves as a ’reminder of highly cash-generative nature of the Supreme platform‘, Supreme said.

Supreme will release its annual results on July 5.

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