(BFM Bourse) – Meal kit specialist Hello Fresh sinks on the Frankfurt Stock Exchange after announcing 2024 forecasts that are significantly lower than expectations. The 2025 objectives are clearly under threat. The stock shows the biggest decline in its history.
Shares of German meal kit manufacturer Hello Fresh fell more than 40% on Friday after the group announced a profit forecast for 2024 that was well below expectations, once again alerting investors after a profit warning in November.
On the Frankfurt Stock Exchange, the stock is currently plunging 42%, heading for its biggest daily fall on record and trading at its lowest price in five years.
The company, which offers kits with fresh ingredients and detailed recipes, also scrapped its 2025 revenue and profit targets.
The former darling of the markets
Citing increased marketing spending and costs related to ramping up its ready-to-eat business, Hello Fresh said it expects adjusted earnings before interest, taxes, depreciation and amortization of 350 to 400 million euros this year.
This figure should be compared to 568 million euros forecast in the consensus provided by the group. Hello Fresh has been a darling of the market during the Covid-19 pandemic, like other food delivery companies, but has had to increase its marketing costs to retain customers once health restrictions are lifted.
The group was also confronted with the post-pandemic inflationary surge. The company said it was setting aside its target of 10 billion euros in revenue and 1 billion euros in adjusted Ebitda in 2025.
The company had cut its 2023 profit forecast in November, citing weaker-than-expected sales growth and higher costs at its North American subsidiary.
(With Reuters)
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