TIDMHUD
RNS Number : 8692Y
Huddled Group PLC
08 January 2024
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the UK version of the EU Market Abuse Regulation (2014/596) which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended and supplemented from time to time.
8 January 2024
Huddled Group plc
("Huddled", the "Company" or the "Group")
Trading Update
Huddled Group plc, focused on building a portfolio of e-commerce
brands, is pleased to report an update on unaudited trading results
for the year ending 31 December 2023 ("FY 2023"), along with an
update on the Group's recent acquisition of Discount Dragon and Q4
2023 trading headline numbers.
FY 2023 highlights
-- Revenue from continuing operations (constituting Discount
Dragon and Let's Explore) of GBP2.2m
-- Net cash of GBP4.2m as at 31 December 2023
-- Further cash of $1.25m due to be received in February 2024
from the settlement of the loan note by the buyer of the Immotion
Location Based Entertainment VR business
-- Profit of GBP15.1m on disposal of the LBE and Uvisan divisions
-- Share buyback programme returned GBP11.5m to shareholders
during the year (net of share option exercise proceeds of
GBP1.2m)
The Group's revenue from continuing operations in the year was
GBP2.2m with almost all of this falling in the last quarter of the
year during which the acquisition of Discount Dragon was completed
and the Let's Explore division entered its peak trading period.
The Group ended the year with GBP4.2m cash following significant
investment in stock, completion of the October off-market buybacks
and outflows of circa GBP1.1m in relation to the Discount Dragon
acquisition (repayment of loans and payment of advisors' fees
associated with the acquisition).
Divisional updates
Discount Dragon
Since completion of the acquisition of Discount Dragon on 17
October 2023 the business has continued to grow strongly.
-- Post-acquisition revenue of GBP1.5m (17 October - 31 December 2023)
-- Q4 revenue increased 37.3% to GBP1.8m (Q3: GBP1.3m)
-- Q4 orders placed increased 18.3% to 48.5k (Q3: 41.0k)
-- Q4 Average order value (AOV) increased 15.9% to GBP35.96 (Q3: GBP31.03)
The early performance of Discount Dragon has exceeded
management's expectations. Our early significant cash investment in
additional stock, including the Motatos stock acquisition, has
powered Q4 trading, as well as underpinning our intent to expand
the breadth and depth of the product range.
The period ahead is about investing for growth, with a number of
initiatives planned to support the continued growth in our key
metrics and drive efficiency - these include:
-- Customer acquisition: Marketing campaigns to drive higher
levels of new customer acquisition across multiple channels.
-- Warehouse facilities: New warehouse facilities are being
explored to drive efficiency and process. In the meantime, we are
confident that the current facility has the capacity to process
circa 30,000 orders per month.
-- Stock: Continued investment in stock and broadening of the
Group's supplier relationships to enable us to extend both the
depth and breadth of SKU's offered to customers.
We are very pleased with the acquisition and excited by the
growth potential of this business, and whilst there is much work to
be done, we believe we are in a sub-sector of the grocery market
where demand has never been stronger.
Let's Explore
-- FY 2023 revenue GBP0.7m
-- Circa 30,000 Vodiac units sold in 2023
-- Over 7,000 Let's Explore units sold in Q4 2023
Sales of the now established Vodiac product have been
encouraging with circa 30,000 headsets sold during the year via its
distributor. Sales have been generated mainly via TV shopping
channels, including QVC in UK and USA, TSC in Canada and TVSN in
Australia.
Our new Let's Explore range has been well received, the move to
immersive learning has definitely hit a chord with parents and
children, underpinning our belief in the revised product range.
Whilst it took longer than expected to reposition our advertising
message, by mid-November this was in flow and demand for the
products both in the UK and USA was strong. In Q4 we sold just over
7,000 units predominantly through Amazon. We plan to take these
learnings into the retail space and make the range an 'all year
round' offering based around immersive learning. We have sufficient
stock, of circa 15,000 units to ensure continuity of supply to both
Amazon and direct to consumer. In addition, we are in the process
of appointing a distributor for this product range to enable us to
extend our offering into the retail space.
Martin Higginson - CEO Huddled Group plc said:
"The recent acquisition of Discount Dragon has been an exciting
addition to the Group. The current consumer environment is
delivering record trading in the discount sector, and we feel that
being able to offer great products, including many of the biggest
brands, delivered to the customer's door, at significantly
discounted prices is a compelling proposition.
"The Let's Explore business continues to progress and we believe
that with modest investment we can create a profitable business in
the immersive learning space. This is something we believe can, in
the foreseeable future, deliver solid returns for the Group.
We have a solid balance sheet and we will invest throughout the
year ahead to drive growth across our businesses. We look forward
to updating the market on our progress."
Enquiries:
For further information please visit www.huddled.com/investors , or contact:
Huddled Group plc Martin Higginson investors@huddled.com
David Marks
Daniel Wortley
Cavendish Capital Markets Adrian Hadden Tel + 44 (0) 207 7220 0500
Limited Charlie Combe
(Nomad and Sole Broker) Dan Hodkinson
Alma Strategic Communications Rebecca Sanders-Hewett huddled@almastrategic.com
(Financial PR) Sam Modlin
Kieran Breheny
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END
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