Social Chain has announced that it is “streamlining its portfolio” with the sell-off “at short notice” of 4 of its brands.
The company, which was founded in Manchester by Steven Bartlett and Dominic McGregor, made the announcement to the German stock exchange, where it is listed.
CEO, Wanja S Oberhof explained that the move was to enable it to focus on its social media agency business, as well as the brand development at DS Group, which it acquired last year for €250.5m. The social media part of the company grew from €19m in 2021, to €32m in 2022.
“We concentrate on the companies within our group which, in our view will create the best synergies for Social Chain as a whole,” stated Oberhof.
“With this focus on our core capabilities and core brands, we implement our strategy with the main objective of ‘profitability’, as announced at our Annual General Meeting in June 2022.”
The group will now prioritise 3 “commerce pillars”: Core Brands, Maxx Group and Brand Chain. That will mean the sale “at short notice” of RAVENSBERGER Matratzen GmbH, Carl Wilhelm Clasen GmbH, DEF Media GmbH, and bytepark GmbH.
The group stated that this would increase its profitability.
As of 30 June, its reported revenues were €220m with a preliminary EBITDA – before adjustments – of €14.5m, which includes the proceeds from the sale of KoRo.
Its operating loss decreased by 35% from Q1 to Q2 to €9.4m.
It expects that its annual revenue following the sell-off, or “portfolio streamlining” will be adjusted to €415 million.
“Despite the difficult environment, we expect a positive non-adjusted EBITDA margin of 4 to 5% for the full financial year,“ explained CFO Andreas Schneider.
“In the third quarter, the company will operate at break-even and return to profitability in the fourth quarter. […] This revenue adjustment helps us to consolidate our total earnings for the future and strategically secure the future basis for our profitable development.”
Oberhof added that “as substantially invested entrepreneurs” they had taken note of the share price and were continuing to invest in Social Chain AG.
“We will remain connected to the company in the long run – because we are confident that its different pillars and its focus on social commerce put us in an ideal position for the future,” he continued.
“Our market segment is currently under severe pressure on the stock exchange; nonetheless, we are convinced of our capability to prove to the market that we can earn money in a solid and profitable way and grow accordingly.”
