NEOM, the fast-growing wellbeing brand that offers a unique range of innovative products to help customers sleep better, stress less, boost mood, and improve energy through its digital-first omnichannel strategy in the UK and internationally, is pleased to announce strong financial results for 2020 (‘FY20’) and continued growth and momentum during the first half of 2021 (H1/21).
FY20 – A TRANSFORMATIONAL YEAR:
- FY20 sales of £28.9m increased by 84% from £15.7m in FY19, driven by successful product innovation and a near tripling of digital sales as more consumers increasingly prioritised their wellbeing
- Digital sales, comprising own E-com and estimated digital portion of Wholesale and E-partners, represented 80% of total sales
- Active customer base increased by 120%, with website traffic increasing by 150%
- EBITDA increased significantly to £4.9m (FY19: £0.4m) reflecting the company’s operational leverage and highly profitable model
- Increased international presence through US partnership with Nordstrom, the launch of the NEOM US website, and partnership with Douglas in Europe
- Continued focus on new product development to disrupt the global wellbeing sector including:
NEOM delivered outstanding strategic progress during FY20 as more and more customers sought the brand’s innovative, natural products to support their wellbeing needs. NEOM’s active customer base increased by 120%, with a 204% increase in total customers placing an order, supporting own E-commerce sales growth of 180% and resulting in total sales growth of 84% to £28.9m.
Product innovation and expansion is key to NEOM’s growth strategy, and during FY20 the brand launched a number of market-disrupting products, with an extension to the Magnesium franchise including Bedtime Hero Magnesium Body Butter, in addition to Clean & Happy Hand Sanitiser Gels and Sustainable Hand Washes & Lotions.
The brand’s very successful digital expansion during FY20 was complemented by the expansion of its ‘wellbeing hub’ retail stores. In October 2020, NEOM opened its latest wellbeing hub in new retail space adjacent to Liverpool St Station, bringing the total number of wellbeing hubs to five.
Sustainability is in the NEOM brand’s DNA, and during FY20 the business continued to seek new ways to minimise its environmental impact in line with its aim of becoming climate positive and zero-waste by 2025. The Company already strives to ensure all its ingredients and materials are sourced from managed and sustainable sources and works alongside its suppliers to reduce the environmental impact of its supply chain to the fullest extent possible. In line with its ambitions, all NEOM packaging will either be refillable, reusable, recycled or recyclable. In 2020 NEOM successfully delivered several sustainability projects to move closer to this goal, including launching new and more sustainable packaging for a number of products.
H121 – STRONG MOMENTUM CONTINUES:
NEOMhas seen further very strong momentum during the first half of 2021 with sales up more than 60% against strong FY20 comparatives. This growth continues to be underpinned by ongoing digital expansion, increasing consumer demand for wellbeing products, and successful product innovation including the timely launch of the new NEOM Pod Mini, a compact diffuser which combines essential oil blends with cold diffusion technology to bring wellbeing benefits to smaller spaces such as the car or home office.
In addition to the digital progress, NEOM has been pleased with the performance of its five wellbeing hubs when they have been able to operate outside of lockdown periods. The hubs, located in London (Wimbledon and Liverpool Street), Guildford, Leeds and Kildare Village, offer consumers the opportunity to directly interact with the NEOM brand and enjoy personalised consultations and personal shopping appointments. In addition, NEOM is partnering with a growing number of premium retailers to operate branded counters to give consumers greater opportunities to engage directly with the NEOM brand. During periods of restrictions NEOM offered virtual appointments for customers.
Oliver Mennell, CEO of NEOM, commented: “We’re delighted to report a transformational 2020 for NEOM. We have delivered significant increases in revenue and profitability, driven by further growth in D2C and digital sales as well as continued successful product innovation. In addition, we are delighted to confirm that this strong growth has continued into the current financial year, with H1 2021 sales up over 60% year on year, reflecting the strength of the NEOM brand and our digital-first omnichannel model, our unique product proposition and position in the significant and growing global wellbeing market. I would like to take this opportunity to thank all of my colleagues at NEOM for their continued outstanding skill and commitment.
NEOM occupies a unique space at the intersection of wellbeing, beauty and lifestyle, with quality, innovation and customer engagement at our brand’s core. Our products, which use 100% natural fragrances and bring true wellbeing benefits to help customer sleep better, stress less, boost mood, and improve energy, are helping us to disrupt and create a whole new product category at a time when consumers need it most.
We have continued to prioritise sustainability in everything we do, sourcing sustainable ingredients and producing almost all of our products in the UK. We have made further strong progress in this area and are looking forward to becoming a proud B Corporation in the near future.
Underpinned by our strong momentum, digital-first model and the significant growth opportunity in the UK and internationally as more and more consumers prioritise wellbeing in their discretionary spend, we are on course to deliver further similar high growth in the second half of 2021 and beyond. The NEOM brand has incredibly exciting growth opportunities supported by our relentless focus on new product development, accelerated consumer shifts towards digital and DTC channels, and international expansion opportunities to build on NEOM’s rapidly developing position in the US market and significant opportunities in other fast-growing wellbeing markets such as China.”