Unbound Newsletter

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Second Edition Unbound Group Newsletter.

Nov - Dec 2022

- A message from our CEO

- Leadership team introductions

- H1 results + outlook

- Hotter updates

- Continuous improvement – LEAN teams

- Awards

- UBG Community Group update

- New starters + long servers (10 years+, since May 2022)

Hi everyone, It’s a pleasure to send you our latest newsletter. A lot has been happening in the world, and within our company since we last spoke. Within the newsletter you will see our first half performance results, which we released to the stock market on 21st September. Key elements are +10% Year on Year growth, and improvements in gross margins - with the Hotter business performing strongly. We told the stock market that we felt the outlook looked uncertain, that we are entering a tougher trading environment. We have seen that emerge over the back end of the summer, with slower sales levels which in turn has meant that we have more stock than we have anticipated to have at this stage of the year.

In order to remedy the problem we have given our factory staff an extended shut down to help rebalance our stock to sales.

We look forward to a stronger November – January period as we come up to the end of our financial year. We are all effected by the economic situation that we find ourselves in, and the business is no different - with increased cost of bills and inflation at record levels. The focus for all of us now has to be 100% on managing our spend effectively.

I appreciate all your efforts at what is a challenging time,

Ian Watson, CEO

Leadership team - new members

Gavin Mason Chief Financial Officer

Many of you may have met Gavin over the years, as prior to joining us as CFO on 1st October, he was a non-executive director of the Unbound Group plc board, and on the board of Electra.

Gavin knows the business very well, and has worked closely with Ian on the development of Unbound Group. Previously Gavin was CFO at Thomas Cook.

Leadership team - new members

Jane Clancy Brand Director

Jane Clancy is working with us as consultant Brand Director, in order to shape the story of the Unbound brand and further develop the Hotter brand. Jane has operated at the forefront of the marketing and creative industries for over two decades.

Jane’s previous experience includes roles as a Managing Director/Director of global network marketing agencies such as Saatchi & JWT, driving best in class brand & marketing agenda across diverse industry sectors, and as in house ChiefMarketing Officer for FTSE businesses.

Andrew Prescott Operations Director

Andrew Prescott joined us as Operations Director on 11th October 2022 - Andrew is a highly experienced operations leader, starting his career at P&G.

Andrew is a LEAN black belt who will be taking our continuous improvement programme to the next level.

H1 results

On 21st September we announced our results for the first half of the year, 1st February – 31st July.

Key highlights are:

Growth with YoY revenues +10.4%. Gross margin improvement 63.3%, a growth of over 1.5%. Positive EBITDA with strong performance in Hotter, however this was offset by initial costs launching the Unbound platform. Hotter performed strongly across all channels despite a challenging economic environment, with strong recovery in Retail.

Outlook

We have seen tougher trading conditions in recent weeks, the short-term outlook is very challenging to predict, given the volatility of the economic backdrop and resultant impact on consumer confidence.

For the remainder of the year we must continue to focus on our LEAN & Continuous Improvement projects and embrace all ideas to converse cash and remove waste.

We have made good progress with partner brand sign-ups for Unbound, and will continue to focus on onboarding further brands within apparel, with plans to introduce wellness categories in Q1 2023.

1. GUIDED BY INSIGHT

2. SUPERIORITY THROUGH SPECIALISM

Insight excellence drives all we do

Expertise and focus are how we win

Established an always-on community of target consumers, ‘U_Space’, to fuel deep insight into their lifestyles, attitudes and behaviours, shaping the future development of Unbound Group.

Further roll out is underway, to position Unbound as the authority voice with the 55+ consumer.

Strengthened our supply chain to increase agility, enabling us to respond to in-season customer demand patterns.

Focused on core-comfort specialist ranges, providing USP in unpredictable customer environment.

At the start of the year we agreed our 5 core strategies,

lets take a look at the ½ year progress.

3. GROWTH THROUGH CONNECTION

4. WORKING SMARTER

We grow our business by curating, connecting and engaging

We fuel success by driving productivity

5. STEPPING UP

Launched Unbound Group customer platform with 7 partner brands.

Lean & continuous improvement progress driving labour productivity.

Finalists for parliamentary Responsible Business Award.

Multi-channel performance demonstrated business resilience in H1, retail performance strong.

ISO9001 Quality management systems achieved.

ESG strategy and business wide targets set and communicated.

We step up – for our business, our planet and our community

Garden centre concession openings

During H1 2022 we opened two Hotter concessions within garden centre chain Notcutts, with further concession opening within Blue Diamond garden centres in Q3 2022.

Expansion of garden centre concession model to reactivate dormant retail dominant customers, that did not convert to digital after the 2020 CVA store closures.

Gardening is a key adjacent category for our specialist demographic of 55+.

PR updates

SS23 press day happening on the 8th/9th Nov where we will present next season’s collection to the UK media. Last season we had a fantastic attendance, with over 150 journalists, stylists, and influencers from leading titles. It really helps to kick off the new season and we often have many sample requests resulting in direct coverage straight after the event.

Following this we are hosting a Christmas influencer and press event at Henrietta pop up Miracle Bar for an intimate gathering of 20 influencers and press. Filled with festive decorations, themed drinks and festive music as well as Hotter Christmas look books, posters and products around the room.

And look out for Hotter on Good Housekeeping online where we’ll be pushing our boots collection.

Hotter SS23 range

Our product team have been busy developing our SS23 range, which continues to evolve and become a wider offer, as we expand into new comfort constructions following the success of recent sourcing and styling trials. We see overall style growth of +4% on SS22.

Our expertise in comfort is further enhanced through the launch of a new technology Flex+ this addition to our family of technologies supports natural movement through anatomically placed flex grooves within Hotter exclusive sole designs.

Comfort technology within the collection has grown by +25% on last season.

Hotter SS23 product strategy reflects the ongoing market shift towards Athleisure and Sport styling. New for SS23 is an exclusive range of functional athletic footwear suitable for light exercise.

Insight, gained via product testing with our core consumer, demonstrates the equal importance of desirability and comfort when buying. SS23 sees the range evolve from being ‘item led’ with a focus on improved styling and a nod to relevant fashion trends.

improvement at

Next round of LEAN trainees

CONGRATULATIONS TO:

CHARLIE TAYLOR

FREYA ROWNTREE

JOEL GRANITE

DAYNE SMART

WILL AMOS

CARLA SCULLY

SAMANTHA GILLAND

ELLIOT GALLAGHER

LEAN

NEXT ROUND (YELLOW BELT):

PAULINE DAVIES

KIERON KENT

MILLIE CULSHAW-SHARKEY

MARK PEARSON

MICHAL KOLACEK

ANTHONY ASHTON

CHARLOTTE FULTON

AMY FRY

STEPHEN WYNN-KELLY

NEXT ROUND (GREEN BELT):

CALUM MANCHINI

CHARLIE TAYLOR

FREYA ROWNTREE

JOEL GRANITE

SAMANTHA GILLAND

Awards

We have been recognised for many of our achievements so far during 2022, here is a round up of all we have collected to date.

Congratulations to all those involved.

Awarded ‘Best Digital Transformation’ – Management Today.

Awarded Drapers Footwear ‘Best Store Design’ for Solihull concept store.

Finalists for ‘Best Retailer’ (£10-100m) and ‘Best Store Design’ at Drapers awards (winners announced 16th November)

Finalists for parliamentary ‘Responsible Business Award’ acknowledging our ESG improvements and plans.

Direct Commerce Awards

CRM, Attribution, Targeting & Personalisation Winners

Made in the North West Digital Engineering/ Technology Award, Manufacturing Apprenticeship /Training Scheme Award plus finalists for Manufacturer of the Decade.

Our Unbound Community Group

The Unbound Community Group (UCG) is designed to involve colleagues in decisions made about the company, its culture and engagement plans.

The group are ambassadors for our Unbound Group’s Values and Behaviours. Recent UCG activity.

For our most recent meeting notes, please scan the QR code.

• Giving feedback on Health & Safety and training initiatives such as eLearning and hazard reporting processes.

• Requesting to review our current vending offers in Head Office to make improvements.

• Supporting Charities such as the Marie Curie Halloween event.

• Helping to co-ordinate the Christmas Party.

• Promoting events such as 5-a-side football Community World Cup, against other local businesses.

Inman

Felton

Blabey

Finishing

Summers

Lucas Nunnery

Brewer

PR

HR

Health

Thompson

Safety

Contact Centre

Vicky Inman v.inman@hotter.com

New starters

Steven Pettener Contact Centre

Brodie Crompton Contact Centre

Liam Wright Contact Centre

Graham Brown Contact Centre

Brandon Mellor Contact Centre

Catherine McHale Contact Centre

Sam Maguire Contact Centre

Louise Jones Contact Centre

Lily McGunigle Contact Centre

Fidelis Mowa Contact Centre

Linda Curtis Contact Centre

Molly Waterhouse Contact Centre

Rachel Free Creative

Ivan Kravec Desma

Petra Oravcova Desma

Lewis O’Brien Desma

Owen Morris Desma

Ricky Charlesworth Desma

Kinga Krawiec Digital Partnerships

Luis Paz Perez Marketing

Erin Hunter Marketing

Christopher Dillow Marketing

Julia Bennison Marketing

Olivia Currie Marketing

Vinicius Rodrigues

Vaz Quality

Kian Leedam Technical & Maintenance

Joseph Foley Warehouse

Katie Reason Warehouse

Aron Nemcsik Warehouse

Sarah Redmond-Sanghera Cambridge Store

Alexander Campbell Canterbury Store

Rajdip Bhandal Canterbury Store

Megan Tanswell Chichester Store

Florence Dyke Chichester Store

Helen Walker Chichester Store

Willow Holder Chichester Store

Wendy Dockree Chichester Store

Neamh Donovan Eastbourne Store

Rebecca Duncan Eastbourne Store

Rebecca Hayward Edinburgh Store

Viktoria Toth-Meryne Edinburgh Store

Charlie-Reece Wheatley-Rae Edinburgh Store

Melanie Featherstone Exeter Store

Abigail Loader Exeter Store

Amy Adams Exeter Store

Beatrice Hawkins Exeter Store

Heather Delooze Finance Store

Emma Porterfield Glasgow Store

Alan Dunn Glasgow Store

Luke Bruns Kingston upon Thames Store

Lesley Prentice Kingston upon Thames Store

Ben Brown Llandudno Store

Meera Kumari Solihull Store

Theresa Scicluna Solihull Store

Jay Poulton Southend-on-Sea Store

Melanie Lal-Kissoon Southend-on-Sea Store

Ellie Cameron Southend-on-Sea Store

Lynn Shailer

Isobel Morley

Belinda Kelly

Loraine Lambert

Alison Cohen

Emily Gunner

Sarah Smith

Bicester Blue Diamond - Garden Centre

Chesterfield Dobbies - Garden Centre

Ditchling Garden Pride - Garden Centre

Ditchling Garden Pride - Garden Centre

Ditchling Garden Pride - Garden Centre

Ditchling Garden Pride - Garden Centre

Melville - Garden Centre

Margaret Gibbs Rugby - Garden Centre

Jasvinder Kaur

Tracey Whittall

Emma Leadbetter

Nicola Wharton-Murphy

Alison McDougall

June Eaton

Wheatcroft - Garden Centre

Wheatcroft - Garden Centre

Widnes Rivendell - Garden Centre

Widnes Rivendell - Garden Centre

Widnes Rivendell - Garden Centre

Widnes Rivendell - Garden Centre

Long servers

10 Years:

Robert Cowper Norwich Liam Coaley Warehouse Lilian Bricklebank Call Centre Lynda Walker Edinburgh Kylie Peruzzi Norwich Karl Bishop Solihull Joanne Lightwood Solihull Dawn Lucy Solihull Gary Thomas Factory

15 Years:

Robert Baines Factory Alan Hughes Call Centre Elaine Griffin Warehouse Matthew Lowe Factory Tracey Spencer Call Centre

20 Years: Ged Wall Marketing Mark Titchener Call Centre Jeanette Hindley Purchasing

35 Years: Joan Stewart Factory

40 Years:

Sue Roughley Factory Vicky Stead Factory

Norwich Warehouse Call Centre Edinburgh Norwich Solihull Solihull Solihull Factory Factory Call Centre Warehouse Factory Call Centre Marketing Call Centre Purchasing Factory Factory Factory