Simba hits £100m in sales and goes from strength to strength in 2020

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Trading Performance Highlights 2020

  • 2019 transitioned the business from heavy historic losses of 2017 and 2018 and positioned the brand for future profitable growth
  • That profitable growth has been delivered and accelerated in 2020 as Simba hit £100m in sales in 2020 and delivered c. £3m EBITDA profit
  • Simba has achieved record sales throughout the last 3 quarters: including sales growth YoY of 35% in Q2, 70% in Q3, 125% in Q4 
  • Simba carries strong momentum into 2021, Q4 2020 was the highest sales quarter and most profitable in Simba’s history
  • The strong trading in 2020 has been achieved through direct e-comm channels, as total digital sales grew by 65% in 2020 representing 97% of total sales in 2020 compared to 84% in 2019 
  • Simba continued to be EBITDA positive across the year and with this cash generation in October it was in a position to pay off its external senior loan from built up cash reserves

Q4 Trading Performance Highlights 2020

  • November was a historic month for Simba, breaking all records, trading up 154 per cent YoY
  • Black Friday Cyber Monday 4-day weekend like for like sales up 160 per cent YoY
  • On Black Friday itself Simba sold 2.4 Hybrid® mattresses every minute
  • Simba had record Christmas/New Year trading with like for like sales up 400% in the two weeks to 3rd Jan 2021 

Other Highlights

  • Simba, alongside other retailers, joined the British Retail Consortium’s Climate Roadmap initiative in Q4, aiming to become net zero contributor to greenhouse emissions and committing to build a fairer, more sustainable economy in line with UN Sustainable Development Goals
  • Simba had a record Double 11 (11th November) in it’s Chinese operations, activating 250,000 Chinese consumers into a Simba health challenge on a local activity app
  • Simba is also proud to have delivered over 19,000 mattresses to health care workers and those working in emergency services with its Help for Heroes pandemic discount scheme 
  • Simba’s success in 2020 has been achieved through focus on a lean and responsive operating model, clear marketing communications, investment in media & sponsorships that have raised awareness of the brand; as well as a continuous focus on product innovation in order to deliver better sleep quality to its customers
  • New patented Titanium Aerocoil® springs launched in the Simba Hybrid® and Simba Hybrid® Pro mattresses 
  • In the UK, Simba was featured in Which? as one of the top 50 products of 2020; the only mattress or sleep product featured. It was also awarded 2020 Product of the Year in the Hybrid Mattress Category

Steve Reid, Chief Executive of Simba, said:

“Like many businesses reacting to the Covid-19 crisis, our first priority was our team, both internally, and across our supply chain and distribution partners; ensuring their safety whilst we put plans in place to continue to trade responsibly. 

“In what has been an exhausting whilst exhilarating year, thanks to the unwavering support and hard work of the team, our now leaner e-commerce focused business model puts us in a position to deliver what we expect to be double digit EBITDA % in coming years.

“Simba has delivered a remarkable turnaround in the last 18 months. The firm has moved from making a significant loss, to a business that is now consistently profitable, whilst delivering all time high revenues throughout 2020 despite the challenges of a global pandemic.”

“To have swung a bottom line loss and to be up above historic high revenues in just a year and a half is testament to the team here at Simba and our partners – which we are eternally grateful for.

“Data from our consumer sleep app reveals people have really wrestled with their sleep during the pandemic, so this upturn could be a reflection of people searching for self-care solutions at a time when anxiety around COVID-19 is causing a plethora of sleep issues. 

“Since launch there has been speculation surrounding the online mattress business model, but this year has proved it can weather even the heaviest of storms.

“Sustained sales growth throughout 2020 has crucially been underpinned with continued profitability, validating that it’s not only robust, but sustainable.

“Four years on, both the business and sector have matured exponentially – rooted in genuine product innovation and consistently evaluating and evolving business practices.”                                                         

OUTLOOK                                                     
With Covid risk remaining plus Brexit, the outlook is by no means certain but Simba is well placed to take on both, especially given its much lower overhead base. 

The shift to online that Covid has accelerated shows no signs of diminishing and looks likely to be permanent across many sectors. The home sector has done particularly well in 2020 and retail reports expect this increase in consumer sentiment to continue.
                                                           
As a technology-first business, we are constantly striving to improve our products. At the end of 2019 we launched a sleep app. The data is proving invaluable – it’s an amazing window into how we sleep, which in turn is influencing how we optimise and develop our product portfolio. 

We have also made a number of improvements to our products and supply chain in 2020 whilst also launching the Hybrid® Pro mattress. 

People have really woken up to the importance and benefits of quality sleep. Something reinforced by our category research which reveals that it’s one of the very few sectors where quality is a greater purchase driver than price, suggesting that good sleep and a quality mattress is not something to make concessions on.

Further innovations and new products are already in development and production for launch across 2021.

The core turned around UK business now provides the catalyst for international growth with a major push coming in China, whilst intelligently accelerating our existing position and market share in France and Canada.

We have valued the expertise, diligent approach and drive for growth from our private equity partner Cartesian Capital Group in our existing scale territories this year. 

The Chinese market presents a once-in-a-lifetime opportunity – but the right partner is essential. Cartesian’s proven portfolio of success in the market provides us with the confidence that we will continue to thrive in 2021.