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Eve Sleep is up for sale following a nightmare of PS56m losses

Eve Sleep has put itself for sale after racketing loss that totalled PS56 million and enduring a 99 per cent drop in the value of its shares in the five years following its listing in the London Stock Exchange.

The decision taken by the top management of the mattress retailer to look for a buyer limits what has proven to be a disaster to City management of fund.

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Eve’s value was around PS140 million at the time it first appeared in the Junior Aim market back in May of 2017, just less than two years after the company was established. The company was able to achieve the valuation despite not turning into a profit, and having generated profits of just PS12 million in the previous year.

It has been unprofitable since, with annual cumulative net losses reaching PS56 millions in 2017 as well as the year before according to the calculations of The Times. The company’s net losses reached PS20 millions in the year 2018, and in the year before, they stood at PS3 million, up from PS2 millions in the year 2020.

Eve is being affected by the rising cost of living crisis, and advised investors on the day that it could not be able to meet its revenue goals for the year , as confidence among consumers declines in the face of rising inflation. Eve stated that it believed it would be in the interest of everyone involved that it looked at “all possible strategic and financing options for the business” including the possibility of a sale. Eve disclosed that it was discussing with an unknown American investor over a possible deal , but that the potential buyer has since pulled out of the deal.

Cheryl Calverley, Eve’s chief executive, stated that Eve’s business needed more capital to reach its potential over the long term. “Recent inbound investor interest has led the board to conclude that the optimum way to build shareholder value and realise the opportunity in sleep wellness is to launch a strategic review to secure either a new owner or a major strategic investment partner,” Calverley stated.

The company’s shares dropped by more than 1/4 p or 21 per cent up to 1 1/4 p after this announcement. This leaves the company with the market capitalisation of just lower than PS4 million. The share price is lower by 99 percent on its 101p-a-share flotation value.

Eve started in 2015 with advertising that it sells “the world’s most comfortable mattresses”. They can be ordered online and shipped in boxes and then removed from the mattresses when they are delivered. The company used to let customers to test their mattress for 100 days after delivery . However, it has been extended to a whole year.

Jas Bagniewski who was Eve’s co-founder and chief executive at the time of the public offering, had stated during the first open market that it was “a new dawn in our vision to be Europe’s leading sleep brand”.

He was dismissed from the company less than a year later at the time Eve admitted that the the management team had made “some strategic missteps”. The replacement, James Sturrock, quickly unwound Eve’s rapid expansion across Europe to focus the business in Europe’s three main markets: the UK, Ireland and France in 2018, down from 15 regions in 2018.

Under Sturrock who stepped down in May of 2020, but is still at the helm as non-executive director along with his successor Calverley who was Eve’s former head of marketing, the company is expanding its products line to expand into the”sleep wellness” market. The company now offers CBD oils candles, drops for a rescue solution to help people get to sleep and also mattresses, bed frames, and bedding. its mattresses.



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