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Supreme Imports is considering floating its 88 Vape brand as a standalone business after returning to profit growth following its aborted IPO last year.

MD Sandy Chadha told The Grocer it was mulling a pureplay float of its vaping business, including the manufacturing side Vapenation, but “no plans have been discussed further”.

88 Vape products include £1 e-liquids, vaping kits and accessories.

The wider business, which also manufactures sports nutrition products and sells branded and licensed batteries and lightbulbs, had planned to float on the AIM market of the London Stock Exchange last year, targeting a valuation of £120m-£140m.

The listing, however, was pulled after investors raised concerns about profitability in the retail sector, with Supreme’s products stocked by the likes of Sainsbury’s, Asda, Iceland, Aldi, Poundland and Amazon, as well as Bestway Wholesale.

The news comes as newly filed accounts show Supreme Imports’ pre-tax profits more than doubled to £12.7m in the year to 31 March 2019, driven by strong sales from its vaping arm.

In its 2018 financial year, profitability slumped 21% to £5.4m as it was hit by one-off costs related to the failed public offering.

Revenues jumped 10% to £80.2m in the year ended March 2019, reflecting a “pleasing performance”, but failing to meet Supreme’s forecasts set at £84m.

Morning update

In this week’s edition of The Grocer, Farmdrop raises a further £5m of growth funds, Loutus Bakeries launches incubator fund with UK healthy snacking acquisition, vegan petcare brand Hownd seeks crowd cash and more.

Check out thegrocer.co.uk/finance for full details today.

Troubled Real Good Food (RGD) has announced it has secured new £8.9m funding enabling it to repay major shareholders.

An £8.87m credit facility has been provided by Leumi and comprises a £5.45m receivables facility, a £1.3m term loan facility – both with a 60 month term – and a £2.1m plant and machinery facility with a 36 month term.

The Facilities carry early termination fees and have standard financial and performance covenants.

A total of £4.5 million of shareholder debt is to be repaid from the proceeds, while the new arrangements will see a reduction in the annual interest charge of some £0.25m.

CEO Hugh Cawley commented: “We are delighted with the support we have received from Leumi in the form of the facilities, as we seek to normalise our facilities with a better balance of bank funding and shareholder support. The bank’s support underpins the work the board has undertaken in streamlining the business units of RGF in order to drive the group towards consolidated profitability.

“I would also like to thank our major shareholders for the financing they have provided over the past few years to ensure the financial survival of the group as we have worked to turn RGF around.”

Elsewhere, Amazon (AMZN) is expanding its footprint in bricks and mortar grocery, with the acquisition of a 3.6% stake in India’s Future Retail.

The Indian chain operates more than 1,500 stores in the country, owning several supermarket brands including budget-focussed grocery and general merchandiser Big Bazaar.

Amazon has also agreed to acquire a 49% stake in Future Coupons, which owns a 7.3% interest in Future Retail, according to prior filings – effectively building Amazon’s stake in Future Retail to around 11%.

On the markets this morning, the FTSE 100 has started the day up 0.6% to 7,172.7pts.

Early risers include FeverTree (FEVR), up 2.5% to 2,271p, Bakkavor up 1.9% to 106.2p, Hilton Food Group (HFG), up 2.2% to 995p and Ocado (OCDO), up 1.7% to 1,224.5p.

Fallers so far today include PZ Cussons (PZC), down 1.5% to 204.5p, Glanbia (GLB), down 0.8% to €10.19 and Sainsbury’s (SBRY), down 0.5% to 199.8p.

Yesterday in the City

The FTSE 100 ended the day down 1.1% to 7,128.2pts

There were some notable FTSE 100 fallers yesterday as the pound rose amid slightly improved sentiment over a possible Brexit deal.

Fallers included FeverTree (FEVR), down 3.7% to 2,216p, Ocado (OCDO), down 3.1% to 1,204.5p, Imperial Brands (IMB), down 2.6% to 2,048p, Coca-Cola HBC (CCH) down 2.1% to 2,682p, Diageo (DGE), down 1.9% to 3,421p, Unilever (ULVR), down 1.8% to 5,025p, Compass Group (CPG), down 1.8% to 2,047p, Just Eat (JE), down 1.7% to 775p and British American Tobacco (BATS), down 1.5% to 2,978.5p.

Retailers Sainsbury’s (SBRY), up 2% and Marks & Spencer (MKS), up 2.5% to 191.8p were notable names on the up.

Other risers included Premier Foods (PFD), up 5.6% to 34p, B&M European Value Retail (BME), up 3.1% to 361p, Hilton Food Group (HFG), up 3% to 978p and Marston’s (MARS), up 2.9% to 126.1p.

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