Science in Sport results hit by Russian closure and staff retention costs

Science in Sport has this morning issued a detail-light half year trading update in which it points to the closure of the Russian business, staff retention costs and raw material price increases as factors disruptors to margin and profitability.

The news, which has sent the share price tumbling 25% back nearly to 2020 lows, suggests that £3.2 million in costs or margin loss against what was budgeted for will hit for the year. Fuel and logistics costs furthered the headwinds against the business, which has an immensely large global footprint after years of export expansion.

All this said, revenue growth is expect to be 12% up versus the first half of 2021, but that is lower than forecasted, prompting the investor caution.

“We believe that our growth will improve in the second half through investment in brands and our digital channels, and through improved pricing,” said the statement.

Finally and adding to hope that the pain can be eased, the firm’s Blackburn facility is now close to completion, which will improve the business’s logistics and overall efficiencies. The gel machine is being installed, and the site will be fully operational by the end of July, according to the RNS.

For the full year of 2021, prior to Russia’s aggression, the Science in Sport (inclusive of PHD) business beat full year expectations, doubling underlying EBITDA from £1.1 million to £2.2 million and registering a 24% revenue growth to reach £62.5 million.