22nd Dec 2021 14:14
(Alliance News) - Less than a year after an ill-fated initial public offering in London, Parsley Box Group PLC said it may need to raise money again.
Shares tumbled on Wednesday as Edinburgh-based meal delivery firm announced lower order numbers, reduced second half revenue, and restricted stock availability.
The stock was down 14% at 37.07 pence on Wednesday afternoon in London, leaving it down 81% from their IPO price of 200p.
Parsley, which listed on AIM in London back in March, said it plans to raise further funding during the first quarter. "Certain members of the board together with their associates have indicated their intention to invest, demonstrating their strong support for the company," it said.
Parsley delivers ready meals to the 'baby boomer' generation, born after the World War Two and broadly defined as aged 60 and over. Its London Stock Exchange ticker code is MEAL.
The company said on Wednesday that "significantly constrained" stock availability had resulted in lower order numbers and lower second half revenue. The update confirmed concerns that Parsley Box shared in a late-September trading update about labour and supply chain issues.
The crimped stock also hurt average order values for much of the second half, the company added. However, Parsley Box noted this had been recovering well in recent weeks as stock availability improved.
Parsley Box said it is on track to deliver 2021 revenue "marginally" over its GBP25 million forecast. The company said this would represent "modest" annual growth. In 2020, Parsley Box reported revenue of GBP24.4 million.
Its year-end cash balance is expected to be approximately GBP2.2 million. In August, the cash balance stood at GBP5.7 million.
Looking forward, Parsley Box said it will continue to monitor the impact of the Omicron variant of Covid-19 on supply chains and said it remains cautious about balancing marketing activity and stock availability in the near term.
"The worst performing IPO of 2021 is going from bad to worse," commented Russ Mould, investment director at AJ Bell. "Parsley Box is getting ready to go cap in hand to investors to ask for more money to help get the business back on track."
Mould added: "Parsley Box has been a real flop since listing, with the shares now down 81% since its March IPO thanks to two horrific trading updates."
In a move to steady the ship, Parsley Box on Wednesday announced the appointment of Simon Russell as managing director. Russell was formerly at retailer John Lewis Partnership in various leadership roles prior to joining Parsley Box. He also ran his own retail consultancy company.
By Heather Rydings; [email protected]; and Tom Waite; [email protected]
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