Eve Sleep has suffered a massive share price crash as its chief executive quits alongside a profit warning.
The online mattress retailer saw share prices dive 60 per cent in morning trading after it announced that sales would come well below expectations, leading to further delays in profitability.
In the first half of 2018, Eve reported sales growth of 61 per cent to £18.6 million, coming up short of the 100 per cent growth anticipated.
This follows a £19 million loss in 2017, despite sales shooting up 132 per cent to £27.7 million.
Co-founder and chief executive Jas Bagnieowski, who took the company public just a year ago, has now announced his departure with immediate effect.
It is understood he will retain a six per cent stake in the company.
“We have fallen short of our own and the market’s high expectations and as a result have taken the tough decision to make management change,” chairman Paul Pindar said.
“Jas has, as one of the founders, been a driving force for this business and has much to be proud of. He leaves with the Board’s best wishes for the future.”
Abid Ismail, who co-founded the business with Bagnieowski, will take the chief executive reins on an interim basis until a replacement is found.
Eve will now focus on growth in key markets like the UK and France, backing away from its former boss’ largely-failed effort to enter multiple new markets.
As part of this new focus on stronger markets, Eve has entered a partnership with Dreams which will see it mattresses sold in 193 of its store in the coming few weeks.
Edison Investment Research analyst Paul Hickman said: “Management, the report says, underestimated what is required to develop a meaningful footprint across continental Europe, while losing focus on its core markets.
“It should not be a surprise that the consumer demand weakness that has hit the high street has not left online retailers entirely unaffected, although there have been few reports of this to date.
“Eve Sleep trades in consumer durables, a vulnerable area when customers become concerned for personal finances.”
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