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By Elric Langton | 24 April 2024
I hope you will excuse the rushed updates today. I am packing my bags and preparing for a cruise around the Fjords with the family.
Supreme, a heavyweight in the fast-moving consumer goods arena, has triumphantly announced a stellar trading update for the fiscal year ending 31 March 2024. This sets the stage for a highly anticipated audit of the financial results that will be revealed on 2 July 2024.
Supreme has reported an eye-popping performance for FY24, doubling its Adjusted EBITDA to a minimum of £38 million from the previous year’s £19.4 million and propelling revenues from £155.6 million in FY23 to around £225 million. This notable ascent in profitability is complemented by Supreme’s ability to conclude the fiscal year debt-free while generating unprecedented cash levels.
Supreme’s strategy has been its robust investment in rechargeable pod system vaping devices. This move highlights its agility and positions it advantageously amidst the shifting sands of the UK e-cigarette market. This strategic diversification starkly contrasts Chill Brands (AIM: CHLL), which has taken a pounding this past year or so, falling from 13.90p to 1.80p, which seems to be lagging in the breadth of its commercial portfolio, particularly in light of the government’s growing scrutiny over smoking and vaping products.
Supreme’s strategic acumen extends beyond its core vaping sector. The company’s commitment to accelerating organic growth through strategic cross-selling and exploring acquisition opportunities to diversify further and scale underscores a comprehensive growth strategy. Unlike Chill Brands, which has a more concentrated focus, Supreme’s diverse commercial portfolio—including its Sports Nutrition & Wellness, Lighting, and Batteries divisions—exhibits resilience and profitability, further bolstering its market position.
We await further details from the announcement of the final results. Supreme’s current trajectory suggests it is navigating and capitalising on the market’s challenges and opportunities. The company’s broad and adaptable product mix, combined with strategic financial management, marks it as a formidable contender in the FMCG sector, well-positioned to thrive despite regulatory headwinds affecting less diversified rivals.
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