Eve Sleep sees sales jump but warns over supply woes
Online mattress retailer Eve Sleep has seen sales surge by nearly a fifth amid the switch to internet shopping, but warned that supply problems may affect growth.
The firm posted an 18% jump in sales over the second half of 2020, which left group revenues 6% higher over the year and helped narrow underlying annual losses to £2 million from £10.7 million in 2019.
But it has been hit recently by industry-wide supply issues due to a global chemical shortage and rising cost pressures of raw materials, which it said may be a “potential limiting factor on near-term growth”.
It was forced to increase its prices in November due to the cost pressures, though it said this had not hit sales.
The group cheered record trading over Black Friday and the first week of the Boxing Day sales as it continued to benefit from the shift online amid the pandemic.
But shares plunged 13% amid the warning over future growth levels, as well as a bout of profit-taking after recent impressive gains.
Eve added that while it has not seen any cost or duty increases since Brexit, there has been some “slowing of pace” of deliveries to Ireland and Northern Ireland due to widespread courier disruption after the year-end transition.
“Eve will continue to closely monitor the situation but does not expect any material full-year impact at this time,” the firm said.
Chief executive Cheryl Calverley said: “We have exceeded our financial expectations for 2020, which were raised twice during the year, extended our product ranges, opened new sales channels, increased brand awareness, presence and recognition, with the winning of the Which? awards, and improved the strength and resilience of our technology, logistics and operations platforms.”
The group will focus on investing in France over the year ahead following a restructuring of the division and launch of a new French website.
“In 2021 we will invest in growth initiatives across our business, particularly in France, where we see good opportunities to scale, whilst continuing to build on the current UK momentum,” added Ms Calverley.
