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Company Profile: S-Ventures

27/07/2023

Company Profile: S-Ventures

S-Ventures (SVEN)

  1. Enthusiastic acquisitive growth last year.
  2. Recent Interims reported a realistic response and signs of recovery.
  3. There is a long-term trend towards healthier ingredients, less meat salt and sugar in food.
  4.  Delivering new products and cost synergies should make H2 EBITDA positive.

Growth Opportunity

It listed in 2020 to acquire health and wellness food companies such as confectionery, plant-based meat, healthy crisps, and chocolate. The team intend to add value with investment and operational skills to accelerate growth. There are six businesses, forming three divisions; Bakery (and free from) – Plant Based free from, Nutrition snacks and chocolate – Technical services.

From a standing start at the IPO S-Ventures now features:

Bakery (and free from) – Juvela Ltd (Wales).

Plant Based free from Nutrition – Pulsin and brands now managed under Pulsin: We Love Purely, Livia’s and Ohso Chocolate (Gloucester).

Stretch Marks

Sven missed its initial forecast, reported accounts late so were briefly suspended, with one of its cquisition filing for insolvency.  In fairness, it was a loss-making turnaround company, based in Germany and acquired for a nominal £1. It folded due to increased cost of ingredients and labour while demand fell for its gluten free pasta and bread brand.  The tough decision was made to close it and the shares are near a 52-week low, even though this event was

Strategic Reboot

The Interims to March 2023 were reported on time although comparisons are difficult, there was a small increase in Revenue to £8.4m and a reduced loss to £1.4m from continuing operations. There is debt of around £3.3m and the strategy has moved from acquisitions to developing existing brands and products using innovative food technologies. The finals to September 2023 should report updates on the progress from new distribution agreements for channels and territories. A new range of Juvela products and the snack brand Pulin are to be released in the Autum.  There is a review underway to increase efficiency from its production facilities in Gloucester and Pontypool.   As these operational improvements are established further funding for acquisitions should be welcomed.

Comment:   It’s been a challenge although corrective action is underway, and it seems a matter of when not if the share price will recover. This process looks to have tentatively commenced.

Data-Kernel

s-venturesplc.com Comment
Price 5.85p
MKt Cap £7.73m
Share in Issue 132.2m
Warrants 5m –25p-100p
Net Cash (Debt) (£3.3m)
Next Results Finals Sept 2023
Last Results Interims March 2023 Increased Revenue £8.4m (7.7%), Op. Loss reduced £1.4m
Last Funding December 2021 £3m at 70p
Employees 76 Total wages  £2.9m
IPO Sept 2020 at 4p Aquis
Shareholders 58% in public hands Scott Livingston: 36.6%
Simon Ashburner: 6.2%
Silverstar Holdings Ltd:5.4%

Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.

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