Warpaint London Stock Tumbles: Faces Headwinds Despite Revenue Growth

Shares of Warpaint London plc (LON: W7L) dropped more than 20% on Wednesday after the cosmetics group reported higher revenues but warned of mounting headwinds and cut its full-year guidance.

For the six months to 30 June 2025, revenue rose 8% to £49.3 million, supported by the acquisition of Brand Architekts in February.

UK sales grew nearly 16% to £18 million, while international revenue edged 3.2% higher to £31.3 million. Gross margins improved by 250 basis points to 45%.

However, adjusted EBITDA slipped 5% to £10.8 million, and profit before tax fell 41% to £6.4 million, hit by £4.6 million in non-cash losses on foreign exchange contracts and acquisition-related costs. Adjusted earnings per share declined 13% to 8.5p, while the group declared an increased interim dividend of 4.0p, up from 3.5p last year.

Warpaint also flagged customer weakness after Bodycare, a long-term distributor of its Technic products, entered administration. The company said amounts due from the customer at 30 June 2025, totalled £0.5 million, and have been provided for in full. However, they noted that there is a further £0.3 million due from this customer from trading after period end, and that future “revenue from the customer is now uncertain.”

Looking ahead, Warpaint now expects full-year revenue of £107 million to £112 million and adjusted EBITDA of £23.5 million to £25.5 million, citing a subdued UK consumer backdrop, continued U.S. market uncertainty due to tariffs, and the loss of Bodycare as a customer.

Chief executive Sam Bazini said: “We have seen conditions remain difficult in recent months, with both consumer and customer confidence being subdued, which now seems likely to remain for some time… we are disappointed to be lowering our expectations for the full year.”