Chill Brands soars as trading strengthens, costs fall

(Sharecast News) - Packaged-goods distribution business Chill Brands said on Monday that it has experienced strong recent trading momentum at its Chill Connect distribution platform alongside a materially leaner cost base following last year's restructuring. Chill Brands said product‑sales revenue at Chill Connect grew at an average rate of more than 55% month‑on‑month between October and January, with combined product and service‑fee income topping £150,000 in January alone.

Revenues for the four‑month period were said to be close to the total generated across the prior 18‑month reporting period, with overall income now exceeding that earlier total.

Chill Brands said demand for its direct‑to‑convenience model continued to run ahead of capacity, with growth constrained primarily by working‑capital availability rather than market appetite. It also said it will expand its product range beyond vaping and nicotine into sundries, beverages and confectionery as part of an effort to increase average order values and broaden its role within the convenience channel.

The AIM-listed group also noted that following its exit from its legacy US operations and the resolution of historical legal matters, more than £800,000 of exceptional costs and over £500,000 of operational expenses had been removed from the business.

Chief executive Callum Sommerton said: "The company's operational performance validates everything we've built with Chill Connect so far. Significant month-on-month revenue growth resulting in increasing monthly revenues since the beginning of the current financial year demonstrate that our model works and that market demand is substantial.

"It is particularly encouraging that demand continues to run ahead of supply and the opportunity ahead is clear. We have retailers asking for more product lines and brands seeking our distribution reach. The market opportunity in convenience retail is only growing larger, and we are determined to take it."

As of 0900 GMT, Chill Brands shares had shot up 33.33% to 0.60p.

Reporting by Iain Gilbert at Sharecast.com