Science in Sport loses millions in sales but insists new leadership will return group to growth
Nutrition specialist Science in Sport has seen its sales fall following a shift in its strategy, but insists its new leadership team is making “significant progress”.
The London-listed company, which sells a range of protein powders, electrolyte products and nutritional supplements, estimates closing the six months ended June 30, 2024, with revenue of £25.5m – a reduction of 27 per cent from £34.4m in the same period for 2023.
Science in Sport said this was due to a shift in sales towards a royalty based model in certain export regions as well as a “conscious step back” from marginal revenue channels to “prioritise profitable, cash generative growth”.
As a result, the company’s management team said it expected its full-year results to be lower than its 2023 figure of £62.7m, but that it expected growth “in the medium term” via a focus on marketing and “strong commercial execution with profit margin growth prioritised”.
During the period the company restructured its leadership team and launched a “cost review and rationalisation programme”, which the company said could deliver annualised aggregate cost savings of more than £6m compared to its previous run rate.
In a statement, Science in Sport said: “The board is pleased to report that the group’s performance improved throughout H1 FY24 as the group made significant strategic progress following the appointment of a new leadership team and a detailed operational review completed in the previous year.
“Whilst the strength of our two core brands, SiS and PhD, is unquestionable, the prior strategy of focusing on top line growth across all channels and markets has been reset so that the business can address the huge growth opportunities and demand for SIS in particular from a solid platform.
“The resetting of marginal revenue channels and a pivot towards controlled profitable growth has reduced revenue in the short term but importantly, margins have and should continue to improve due to significant operational cost efficiencies and more disciplined pricing.
Executive chairman Dan Wright added: “The board is pleased to report that the group performed strongly in H1 FY24 delivering substantial growth in underlying EBITDA year on year with profitability margins improving at both a gross and a trading contribution level.
“This is underpinned by the resetting of the cost base following detailed review of operating costs.
“Whilst the business has consciously stepped away from low margin revenue streams in the short term, we do anticipate controlled and sustained revenue and profit growth in the medium term.”