Mark Winter, chief executive of My Food Bag. Photo / Supplied
Mark Winter, chief executive of My Food Bag. Photo / Supplied
The cost of living and “deteriorating economic environment” have eaten away at My Food Bag’s half-year finances, leading to the meal-kit company reporting one of its worst-ever results.
My Food Bag (MFB) announced on Thursday that its half-year net profit after tax was $2.5 million, a 57.6 per cent fallfrom $5.9m net profit in the same period in 2022.
Ebitda came to $7.4m, falling from $11.5m the year before – a 35.6 per cent decrease.
Revenue was down 11.2 per cent to $83.8m.
Despite the “deteriorating” economic environment, chair Tony Carter said the first half of the 2024 financial year was a ”successful period of transition”, with MFB stabilising demand and growing its active customer numbers.
He told the market in the results announcement the company was still a profitable business with a strong brand and customer offering, and MFB was continuing to proactively reduce costs.
“We continue to focus on debt reduction, capital management and rightsizing the business through the rest of the financial year.”
Something that did head in a positive direction during the half-year was MFB’s active customer base at 61,600 active customers by Sept 30, up from 57,500 at the end of the 2023 financial period in March.
MFB’s budget meal-kit option Bargain Box also reported delivery volumes up 11 per cent on the 2022 half-year, and the company said it was performing particularly well.
Mark Winter, chief executive of My Food Bag. Photo / Supplied
The company’s gross margin shrank from 49.3 per cent in the last corresponding period to 47.9 per cent, a 1.4 per cent decrease.
Deliveries fell 80,000 to 652,00 year-on-year, which MFB said was due to low consumer confidence and inflationary pressures.
No dividend
The board decided not to declare an interim dividend.
“While the board intends to resume dividend payments with a final FY24 dividend, this is subject to both net debt position and financial performance across the remainder of FY24,” Carter said.
In May, at its 2023 full-year results, the meal-kit company said cash flow had been affected in the period by “subdued demand” and also some one-off costs and strategic investment in pick technology.
It reported a full-year net profit after tax of $7.9m, a stark drop from its $20m net profit after tax a year earlier.
Due to the cashflow, the My Food Bag board took the “prudent” approach not to pay a final dividend for the 2023 financial year.
At MFB’s annual meeting in August, shareholders complained about the company’s sluggish share price. It has struggled since it was listed, and so far in 2023, the stock has fallen 66.5 per cent.
“The board is obviously concerned about the share price,” Carter told shareholders at the August AGM.
“It’s something that we are not pleased with.”
In early November, wealth management firm Jarden cut back its target price for the stock by 44% to 25 cents per share (cps) – down from the previous 45 cents target.
