THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION 11 OF THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019/310.

30 June 2026

Chill Brands Group plc

("Chill Brands" or the "Company")

Interim Results

Chill Brands, the consumer packaged-goods distribution company, announces its unaudited results for the six months ending 31 March 2026 (the "Period").

This Interim Report covers the six-month period from 1 October 2025 to 31 March 2026. It follows the Company's Annual Report for the prior financial year, covering the 18-month period ended 30 September 2025, published on 30 January 2026.

Financial Summary

Operational Summary

Callum Sommerton, Chief Executive Officer of Chill Brands, said:

"We delivered Chill Connect's strongest period of revenue growth to date in the first half, reflecting clear and increasing demand from both retailers and brand partners for our distribution proposition. As planned, we invested ahead of revenue, with costs reflecting the build-out of a national operating platform, including a UK-wide field sales team and enhanced promotional and activation capabilities. This investment positions us to better serve existing partners, improve retention, and accelerate new client acquisition, although it has resulted in a period where cost growth has outpaced revenue.

"Looking ahead, our focus is on converting that operational platform into scalable, capital-efficient growth. We expect trading in the second half to continue broadly in line with current trends, however, this remains dependent on securing sufficient working capital to support the business. The Board is undertaking a thorough review of the Group's operations, funding requirements and strategic options to determine the most appropriate path to build long-term shareholder value."

Enquiries:

About Chill Brands Group

Chill Brands Group plc (LSE: CHLL) is a distribution-led consumer packaged goods company serving the UK convenience retail sector. Through its Chill Connect platform, the Company operates a national field sales team providing direct-to-store distribution and advisory services to brands seeking to expand their distribution into the independent convenience channel. The Company's product range spans vaping and nicotine alternatives, with active expansion into sundries, beverages, confectionery, and other fast-moving consumer goods. Chill Brands partners with established FMCG businesses and emerging brands to provide comprehensive route-to-market solutions. The Company also owns the premium chill.com domain name.

Publication on website

A copy of this announcement is also available on the Group's website at http://www.chillbrandsgroup.com

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Operational Review

The first half was a period of substantial commercial growth for Chill Connect, the Group's distribution business, delivered while the Company remained tightly capital-constrained. 

Chill Connect has been the Group's core commercial opportunity and focus throughout the Period and remains so.  It has grown, brand partners of real stature have chosen to work with it and the field sales team has executed well in challenging conditions.

During the Period, the Group saw revenue grew substantially, with trading revenue of approximately £726,000, a monthly run rate close to four times that of the prior eighteen-month period. This growth resulted from the core infrastructure of a national distribution business put in place including a field sales force with UK-wide coverage, fulfilment and warehousing, established supplier and brand relationships, and the systems to run them.

Chill Connect generates revenue through two distinct streams. The first is service fees: monthly retainer income paid by brand partners for field sales representation, market access, and commercial advisory. These fees are recurring, require limited capital to deliver, and are designed over time to cover a growing proportion of the Company's fixed cost base - creating a foundation of revenue predictability that a pure distribution model cannot provide.

The second stream is product distribution, wherein the Company buys stock from brand partners and resells it to independent convenience retailers, earning a margin on the transaction. This strand is where the capital constraint is most acute. To generate distribution revenue, the Company must first deploy cash to buy inventory - hold it, warehouse it, and wait for payment from retail customers. In a well-capitalised business this cycle is self-funding once at scale.

During the period the Company continued to win and grow brand partner relationships across a number of leading and emerging names in the nicotine vaping category, alongside other recognised challenger brands. The product range has been extended to include beverages, confectionery, batteries, and other adjacent FMCG categories, reducing the business's category concentration and reflecting a deliberate strategy of diversification.

To date, the majority of Chill Connect's activity has been concentrated in the nicotine vaping and alternatives category, where the Company's brand relationships are deepest and demand has been strongest. That category has historically been volatile, shaped by regulatory change, shifting consumer preferences and periodic disruption to supply and the Board is realistic about the risks that come with it. At the same time, the category remains substantial and buoyant, and the Company has shown it can navigate that volatility. A particular strength of the Chill Connect model is the agility with which it can adjust the range it carries, moving quickly between brands, formats and products as demand and regulation evolve.

Notwithstanding the opportunity the nicotine category continues to present, the Board considers it important that the business is not wholly dependent on a single, regulation-sensitive category, and has therefore prioritised broadening the range Chill Connect distributes. During the Period the Company extended into adjacent categories including confectionery, personal care and other convenience sundries, alongside beverages and batteries. This diversification reduces exposure to regulatory and fiscal change affecting any one category, widens the pool of brand partners and retailers the business can serve, and draws on the same core capability, taking a broad range of products into the independent convenience channel efficiently.

Post-period end, the Company launched a wholesale ordering platform, with more than 2,000 initial convenience retailer accounts onboarded at launch, letting retailers order directly and extending reach without proportionate increases in field sales cost.

Chill.com

The Chill.com domain remains a material balance sheet asset, independently appraised at a fair market value in excess of its original USD 1.6 million acquisition cost. Chill Connect remains the Group's core commercial focus and the primary recipient of available management time and capital, and chill.com has continued to receive limited investment as a result.

Board Changes

Nick Tulloch resigned as Non-Executive Director on 31 March 2026 to focus on other business interests. The Board thanks him for his contribution during his tenure and will review the composition of its committees in due course.

Financial Review

Revenue for the six-month period ended 31 March 2026 increased significantly to £726,382 (2025: £141,699).

As disclosed in the Trading Update of 9 February 2026, the Company experienced significant growth and commercial momentum in the months following the start of the Period, with combined product sales and service fee revenue increasing materially on a month-on-month basis.

Despite the increased sales levels, the gross margin loss increased from £19,393 in the corresponding six-month period to £283,807. As mentioned above, the Company invested in infrastructure of a national distribution business including a field sales force with UK-wide coverage. A further element of the gross loss for the Period reflects the Company selling down inventory it held from a particular brand. Market conditions affecting that brand, and damage to its wider value chain that was outside the Company's control, reduced the price at which the related stock could be sold. The Company took the decision to sell that inventory through, frequently at or below cost, in order to recover what value it could and release the cash tied up in it.

On a product-only basis, the Company continues to earn a positive albeit compressed margin on the goods it sells.

In addition to trading revenues, the Period included a one-off receipt relating to the settlement of a legal dispute with a former professional adviser, in connection with matters arising from the governance disruption of 2024, as announced by the Company on 23 October 2025. The gross settlement was £216,753 (before legal costs). This is a non-recurring item and is treated separately from the Company's core trading performance described above.

Administrative expenses were £727,745 (2025: £674,529), representing a 7.9% increase on the comparative period to 31 March 2025. These costs include a provision against doubtful debts of £118,947 which the Directors consider unlikely to be collectible.

The Company drew an additional £540,000 from the existing working capital loan facility of up to £1.0 million put in place by the Company's largest shareholder to fund Chill Connect's operations and inventory purchases. Finance costs of £273,939 (2025: £96,430) were incurred, relating to the convertible loans and the working capital facility loan from the Company's largest shareholder.

The net loss for the period was £1,068,610 (2025: £726,434). The loss per share increased to 0.21p (2025: 0.14p).

Outlook

FMCG distribution is inherently working capital intensive, requiring the upfront funding of inventory ahead of receipts from retail customers. During the first half, the Group's growth was constrained by the availability of working capital rather than underlying demand or operational execution.

Looking ahead to the second half, trading performance will continue to be primarily driven by access to capital to support inventory investment and the expansion of Chill Connect. Subject to securing sufficient funding, the Board expects trading to progress broadly in line with trends established during the Period, supported by continued growth in the brand partner base, increasing recurring service-fee income, and early traction from the recently launched wholesale ordering platform.

The Board recognises that reliance on related-party funding is not a sustainable long-term position. While the existing working capital facility provides necessary short-term support, the Group requires a more robust and scalable capital structure to fully realise the significant commercial opportunity available.

As stated previously, the Board is actively progressing a range of early-stage discussions relating to potential strategic partnerships, investment opportunities, and broader corporate transactions aimed at strengthening the balance sheet and enhancing shareholder value.

No definitive course of action has been agreed and no commitments have been entered into. The Company will update shareholders as appropriate when material developments occur.

Principal Risks and Uncertainties

In accordance with DTR 4.2.7R, the Board has identified the following as the principal risks and uncertainties facing the Group for the remainder of the financial year:

·    Regulatory and fiscal change in the vaping and nicotine alternatives sector. The UK regulatory environment continues to evolve, including under the Tobacco and Vapes Act 2026 and prospective changes to UK vaping taxation. Further legislative or fiscal change could affect product availability, consumer demand and the commercial terms on which Chill Connect operates, and may also affect the willingness of brand partners and capital providers to commit to the category.

·   Funding and liquidity risk. The Group's ability to continue trading and to grow Chill Connect depends on access to working capital, principally through related-party funding to date. The Group remains dependent on securing additional funding and/or completing a strategic transaction within an appropriate timeframe, and there is no certainty that either will be achieved on acceptable terms, or at all.

·    Execution risk relating to a strategic transaction. There is no certainty that a suitable transaction will be identified, agreed or completed, and the process of pursuing one may itself absorb management time and cost without a successful outcome.

·    Tax and creditor compliance risk. The Group has historic tax liabilities that remain subject to ongoing engagement with the relevant tax authority, and is separately in the process of seeking recovery of a related VAT rebate. There can be no certainty as to the timing or outcome of either matter, and any adverse development, including accelerated repayment demands or enforcement action, could increase the Group's near-term cash requirements.

·   Working capital constraint on growth. Independent of the above, the pace of Chill Connect's growth remains constrained by the capital available to fund inventory, and this is expected to continue to limit the rate of expansion achievable in the second half of the financial year.

Statement of Directors' Responsibilities

The Directors confirm that, to the best of their knowledge:

a)   the condensed set of financial statements, which has been prepared in accordance with UK-adopted International Accounting Standard 34, "Interim Financial Reporting", gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole, as required by DTR 4.2.4R;

b)   the interim management report includes a fair review of the information required by DTR 4.2.7R, being an indication of important events that have occurred during the six months ended 31 March 2026 and their impact on the condensed set of financial statements, together with a description of the principal risks and uncertainties for the remaining six months of the financial year; and

c)   the interim management report includes a fair review of the information required by DTR 4.2.8R, being related party transactions that have taken place in the six months ended 31 March 2026 and materially affected the financial position or performance of the Group during that period, and any material changes in the related party transactions described in the last Annual Report.

The Directors of the Company at the date of this report, and their functions, are: Callum Sommerton, Chief Executive Officer; Graham Duncan, Finance Director; and Harry Chathli, Non-Executive Chairman.

This responsibility statement was approved by the Board of Directors and is signed on its behalf by:

Callum Sommerton
Chief Executive Officer
30 June 2026

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