27th Jul 2022 13:35
(Alliance News) - Shares Parsley Box Group PLC fell sharply on Wednesday after the ready-made meals company saw significant a drop in revenue and new customers.
Shares in Parsley Box were down 29% at 12.40 pence in London on Wednesday.
The Edinburgh, Scotland-based company reported revenue for the six months to June 30 decreased 31% to GBP9.6 million from GBP14.0 million the year prior. This can be attributed to a 45% drop in total order numbers to 212,000 from 385,000 the year before.
During this period, new customer revenue decreased by 70% and repeat customer revenue decreased 21% from the previous year.
In addition, the cost of acquiring new customers increased to GBP34 million from GBP31 million the year before, with the cost of repeat orders doubling to GBP6 million for the first half.
"Deploying cost effective marketing spend continues to be a key challenge in the business," Parsley Box said.
Parsley box narrowed its loss of earnings before interest, tax, depreciation and amortisation by 42% to GBP2.1 million from GBP3.6 million the prior year.
Looking ahead, the company expects full year revenue to be GBP19 million, down 25% from GBP25.5 million at the end of 2021, as a result of increased acquisition costs and the drop in total orders. Ebitda for the year is also expected to be a loss of GBP4.1 million due to management of marketing spend in the second half, together with the improved gross margin percentage.
Parsley Box recently formed a partnership with the Daily Mail online and a new TV campaign is set to launch in September. Additionally, a membership scheme will launch in August with the aim of attracting repeat customers. The company said it will reduce other marketing acquisition activities from the final quarter should the high costs persist.
Chief Executive Officer Kevin Dorren said: "We have continued our product innovation at pace to increase the opportunities for customers to order from us, and remain focused on balancing investment in customer acquisition and maintaining cash reserves, whilst we navigate the challenging consumer environment. We recently brought down the price of a range of customer favourite meals to GBP2.95 to help alleviate the rising cost of living, and have frozen all prices until September. We remain well funded and continue to deliver quality, good value, and nutritious food."
By Dominique Pretorius; [email protected]
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