Eve Sleep reveals sales slump days after merger called off
Online mattress retailer Eve Sleep has posted sliding revenues, a week after the business revealed plans to merge with a rival had collapsed.
Eve said falling sales resulted in group revenue sliding 8% to £12.9 million in the six months to June 30.
The direct-to-consumer retailer saw its shares dip further on Thursday as it reiterated it expects full-year revenues to fall short of previous forecasts.
Eve said it expects to deliver between £25 million and £27 million in revenues in 2019 after it was impacted by “worsening macro-economic conditions and near permanent heavy discounting by competitors”.
Lower revenues are also expected to impact its earnings before tax and interest, with the firm expecting to post an earnings loss for the period.
However, the firm confirmed it halved its earnings losses to £5.9 million for the six months to June after focusing on its core UK, Ireland and France territories.
Eve said that despite lower revenues, it saw an increased percentage of its sales coming from non-mattress products, while its customer repeat rate also improved.
It added a number of retail partnerships, including one with Argos, have recently launched while its retail deal with Next Home expanded last month.
The figures come a week after Eve confirmed its proposed merger with rival Simba was called off.
In August, the two rivals confirmed talks on a deal, but bosses said they had “decided that now is not the right time to pursue the potential merger”.
James Sturrock, chief executive of Eve Sleep, said: “We are making good progress with our strategic focus to build a sleep wellness brand, as a key differentiator to peers and to secure the foundations for a profitable and sustainable future for Eve.
“While the headwinds have increased, we have a flexible and adaptable business model, alongside a strategy that will clearly differentiate eve in the longer term from peers.
“We will continue to focus on the rebuild strategy through a combination of organic improvements and inorganic opportunities as and when they arise.”