Bed-in-a-box brand eve Sleep has announced that its early-stage merger talks with competitor Simba Sleep, announced on 12th August, have ended.
eve's board decided that now is not the right time to pursue the potential merger, and that it is more appropriate to focus on eve's rebuild plan, as previously communicated to investors in the company's 2018 results announcement on 12th March. Trading in the company's shares has now resumed.
James Sturrock, CEO of eve Sleep, comments: "We have continued to make progress with our rebuild strategy and have taken action to reduce our cost base, including a significant reduction in administrative expenses compared to 2018 along with a refocused and reduced marketing investment strategy removing inefficient activity. We anticipate a significant reduction in losses in 2019.
"The opportunity to create a leading sleep wellness brand remains undiminished and I am confident that eve's rebuild strategy, centred around a differentiated brand positioning, expanded product range, lower friction customer experience, combined with increasing brand awareness sets out a clear path to building a profitable business, which delivers for shareholders. We will continue to examine ways of accelerating eve's rebuild strategy and the move to profitability, through organic and inorganic growth."
Thanks to a new marketing strategy, eve reports a +50% improvement in brand awareness (from 10% at the start of the year), while new product and the implementation of a fresh ERP system have helped its performance. However, the challenging nature of overall trading has led the board to revise its outlook for 2019 revenues, which are now likely to be in the range of £25-£27m.