Eve Sleep PLC (LON:EVE) has quit merger talks with Simba Sleep Ltd, saying it is “not the right time” to pursue a potential acquisition.
The struggling mattress firm said it has decided to focus on its recovery plan, which was announced in March.
Eve Sleep unveiled it was exploring a merger with Simba Sleep in August following media speculation.
Its shares will resume trading today now the talks have ended.
The company also revealed that its losses halved in the first half on the back of its cost-cutting programme. However, the group said overall trading has been more challenging than expected due to an uncertain economic outlook and continuing low levels of consumer confidence.
It now expects 2019 revenues to be in the range of £25mln-£27mln.
Chief executive James Sturrock said: "We have continued to make progress with our rebuild strategy and have taken action to reduce our cost base, including a significant reduction in administrative expenses compared to 2018 along with a refocused and reduced marketing investment strategy removing inefficient activity. As detailed above, we anticipate a significant reduction in losses in 2019.
"The opportunity to create a leading sleep wellness brand remains undiminished and I am confident that eve's rebuild strategy, centred around a differentiated brand positioning, expanded product range, lower friction customer experience, combined with increasing brand awareness sets out a clear path to building a profitable business, which delivers for shareholders.
“We will continue to examine ways of accelerating eve's rebuild strategy and the move to profitability, through organic and inorganic growth."