Competition across consumer markets is ferocious. Here the winners are those firms that can continually reinvent themselves through product innovation, in-licensing & brand diversification. A trend that is becoming ever more important as cash-strapped consumers increasingly gravitate toward trusted, affordable everyday brands, such as those owned & distributed by Supreme.
In fact following hot on the heels of last month’s five-year Carabao Group energy drinks partnership. Today’s announcement of a new licensing deal with iconic Italian luxury lifestyle brand Tonino Lamborghini Energy Drink BR looks another smart strategic step by entrepreneurial CEO Sandy Chadha and his team.
Why? Well with a substantial distribution network servicing more than UK 3,000 retailers, alongside accredited manufacturing facilities, product innovation expertise and deep category relationships. This infrastructure means Supreme PLC can efficiently integrate new brands, launch fresh products quickly and leverage significant cross-selling opportunities across multiple retail channels not only in the UK, but also internationally in Europe, the Middle East and China.
Plus the Tonino Lamborghini Energy Drink BR brand brings premium positioning, strong consumer awareness and aspirational appeal, particularly within drinks and adjacent FMCG verticals. Alongside helping of course to expand production volumes at its Clearly Drinks site in Sunderland and improve profitability with little capital investment.
Elsewhere the group is performing strongly too. Indeed last year Vaping still grew revenues 10% despite the UK’s disposable vape ban - augmented by impressive performances from Drinks & Wellness, the successful integration of SlimFast UK and solid momentum across beverages (eg Typhoo Tea).
CEO Sandy Chadha commenting: “This partnership further demonstrates Supreme PLC’s ability to work with globally recognised brands, leveraging our manufacturing expertise, innovation capability and extensive retail footprint to drive future growth opportunities.”
Finally wrt the numbers, Shore Capital recently upgraded their March FY26 forecasts to £265m of revenues (+14.6%), £40.6m EBITDA and 19.6p EPS. Meaning at 162p, the stock trades on just 8.3x PE and 4.6x EV/EBITDA, whilst equally paying a handsome 5.2% dividend yield and having £2.2m of net cash (ex IFRS16 leases).
Sure there’s a new UK vaping tax being introduced from Oct’26 onwards. Yet even so Supreme looks like a business leveraging its scale, channel strength, FMCG brands and product diversification to deliver growth amidst the toughest of backdrops.
Disclosure: Supreme PLC is a Vox Markets client.