Science in Sport (SIS) H1 2024 earnings summary

Executive summary

• Interim results for H1 FY24 show a strategic shift to margin enhancement, with EBITDA up 74% year-over-year despite a 25.4% revenue decline.

• Cost rationalisation, restructuring, and a focus on profitable channels underpin improved margins and cash generation.

• Equity fundraising of £8.5m and extended banking facilities to 2027 provide liquidity for growth and restructuring.

• SiS and PhD brands maintain strong recognition, with SiS products used by over 330 elite athletes and teams, including 100+ Paris Olympics medals.

Financial highlights

• Revenue fell to £25.7m (down 25.4% year-over-year), mainly due to strategic exit from unprofitable channels and working capital constraints.

• Gross profit was £11.5m (down 20.8%), but gross margin improved to 44.6% from 42.0%.

• Underlying EBITDA rose to £2.0m (up 74%), with margin up to 7.7% from 3.3%.

• Adjusted net debt at period end was £13.8m, slightly higher than H1 FY23.

• Loss for the period was £2.5m, improved from £3.3m loss in H1 FY23; basic and diluted loss per share was (1.4p) vs (1.9p) prior year.

Outlook and guidance

• Trading in H2 FY24 has started in line with expectations; management anticipates revenue and profit growth from the H1 FY24 baseline.

• Margin improvements and cash generation expected to continue as cost savings annualise and inventory investment improves product availability.

• Leverage expected to normalise around 1.0x EBITDA in the medium term.

• Board confident in controlled, sustained growth, supported by new product launches and operational efficiencies.