InnovaDerma PLC (LSE:IDP) said it is optimistic it will return to profitability this financial year as its turnaround strategy gains traction.
With the focus on profitable sales through gross margin improvement and the prioritisation of it Skinny Tan brand, turnover for the first half of its financial year fell to £3.7mln from £4.1mln.
The business has undergone a ‘radical simplification’ while management continues to focus on ‘rigorous cost control’, investors were told.
At 84% of revenue, tanning line Skinny Tan is now the ‘highest priority future growth driver’, InnovaDerma said.
It added that the Charles + Lee men’s skincare range has shown ‘excellent’ retail sales growth during the six months to December 31.
It said its focus on Amazon as a sales platform and its ‘exciting’ collaboration with Love Islander Liberty Poole were both ‘delivering strong benefits’.
As part of the restructuring, the company said the Roots and Nuthing brands have been ‘deprioritised’.
"The board remains optimistic that the transformation plan enacted this year, as well as underlying improved consumer consumption and retail momentum versus last year will enable the business to continue its improvement trajectory with a return to profitability this year remaining the board's intention," said chief executive, Blake Hughes.
"We are making strong progress in simplifying and reshaping our business as we focus on delivering sustainable, profitable revenue growth.”
He added that while Omicron had presented some short-term uncertainty, “I believe that we will see a significantly stronger tanning season in the six months ahead”.
“We have a strong foundation for the second half of the year which will be further supported by exciting new product launches on Skinny Tan which have already received excellent retailer support,” Hughes told investors.