Revolution Beauty, a fashion brand facing challenges, has reinstated its co-founders, Adam Minto and Tom Allsworth, to take charge of the business following an unsuccessful search for a buyer. The duo had previously resigned due to accounting-related issues. The company, which sells makeup and cosmetics online and through retail partners, announced that it would no longer pursue the sale after failing to receive suitable offers since initiating the sale process earlier this year. Notably, Frasers Group, owned by Mike Ashley, decided against making an offer after previously considering a bid.
In an effort to revitalize the brand, Revolution Beauty plans to raise approximately £15 million by issuing new shares. The company aims to implement a revised strategy to restore profitability. Minto will serve as a consultant for £160,000 annually, while Allsworth will take on the role of chief executive. The firm anticipates further cost reductions, including staff cuts, to save an additional £7.5 million by 2027.
Recent financial disclosures revealed a significant decline in sales, with a 25.5% drop resulting in revenues of £142.6 million for the year ending February 28. Additionally, the company reported a pre-tax loss of £16.8 million, in contrast to an £11.4 million profit the previous year. Minto had previously agreed to pay nearly £3 million to settle discrepancies linked to personal loans associated with undisclosed transactions involving an employee and distributors.
Despite the challenges, Chairman Iain McDonald expressed a belief in the potential for recovery, noting the brand’s strong social media presence and collaborations with influencers. The return of the original management team is viewed as a step toward regaining growth and long-term value, prompting questions about the effectiveness of leadership changes in addressing deep-seated financial issues.
Source: https://www.bbc.com/news/articles/c36j2nxg202o?at_medium=RSS&at_campaign=rss