Sole focus on profitable branded business
Brand Architekts is enjoying a new clarity of purpose: to create a business focused solely on owned brands. This follows the disposal of our contract manufacturing business for £35m. This transformational deal was a milestone in the Group’s strategy of accelerating its owned brands business with its higher margins, lower capital investment requirements and superior financial returns.
Opportunities for further growth online and internationally
The increasing shift online has highlighted the importance of having a strong direct-to-consumer (DTC) reach, and we plan to make significant investments to strengthen our consumer reach and engagement. In parallel, we will focus on maximising our brands’ potential in new international markets and building relationships with appropriate distribution and retail partners.
Substantial net cash position
The Group’s balance sheet is carrying high levels of cash following the disposal of the manufacturing business. The Group had a net cash position as at 27 June 2020 of £18.0m (excluding lease liabilities).
Distinctive and appealing brand portfolio
One of the key strengths of the business is its broad portfolio of brands. Brand Architekts covers all the main bases: from female beauty to male grooming, and from masstige to everyday value.
Potential for M&A
Given the strength of the balance sheet, the Group remains alert to acquisition opportunities that will further strengthen its areas of core competence – category, channel and consumer – as well as more nascent areas for the Group such as DTC and international reach. The business will factor in current and future consumer behaviour; consumption and proprietary technology; and product point-of-difference.
New and experienced leadership team in place
The sale our manufacturing interests was followed by changes to our management structure and fresh appointments to take the owned-brand business forward. This included the appointment of Quentin Higham as CEO and Thomas Carter as CFO. We now believe that we have the team in place to build scale and deliver further profitable growth.
Established relationships with retailers both domestically and internationally
Understanding the needs of retailers, and answering them with distinctive and compelling products, has been the foundation of Brand Architekts’ success to date. It also reflects the strength of relationships that the business has long enjoyed with its key customers. We will now look to build on that trust and credibility by better understanding our end-consumers and their individual needs. By applying more science and analysis of data we can improve and create more powerful, sustainable brands of real substance.