Parsley Box losses mount as new customers fall
Ready meals company Parsley Box, led by Scots entrepreneurs Chris van der Kuyl and Kevin Dorren, saw losses mount and new customers fall after a “challenging” year since the company floated in March last year.
Income from repeat customers rose from £17.5m to £20.7m but was offset by revenue from new customers falling by more than a third (31%) from £6.85m to £4.72m. Order numbers from repeat customers rose 15% but fell 30% for new customers.
The loss for the year rose 206% from £3.18m to £9.73m. The EBITDA loss surged 228% from £2.17m to £7.11m. Cash in the bank has risen from £900,000 to £2.5m.
Post-period, Parsley Box raised £6m from shareholders in a placing and offer in which Mr van der Kuyl, chairman, and Mr Dorren, were subscribers. The board said it would enable the group “to recommence higher targeted marketing and execute its growth strategy”. However, this fell £1m short of target as shareholders snubbed the open offer following a sharp fall in the company’s value since the IPO.
In a statement, the company said that after a challenging 2021, the equity fundraising “gives the Board confidence that 2022 will be the beginning of a new chapter in the group’s development.”
Stock levels have continued to increase since the year end and more than 95% of product lines are now available, delivering good growth in basket size and high service levels. The group said it is progressing well towards its FY22 target of 25% growth in repeat AOV through an increased pace of product innovation and good stock availability.
The group is focused on implementing the fresh targeted marketing strategy. It said this is already showing early positive signs of acquiring higher spending customers. Whilst marketing expense was reduced in the first quarter by circa 50% of the FY21 average to test the new strategy, higher levels of marketing spend has resumed from April to stimulate higher order numbers.
Costs are being managed so that adjusted EBITDA losses have reduced in the period to date and are in line with management expectations for FY22.
Despite the wider macroeconomic challenges, with the funding complete, stock levels in good shape and the new marketing strategy showing early positive signs, the board remains confident about the year ahead.
Mr Van der Kuyl said: “The group built on the increasing loyalty to the brand by delivering 18% growth in repeat order revenue and growing active customer numbers by 8%, and as we stand today, most of the supply chain challenges are now within our control.”
Kevin Dorren, CEO, said: “We have stabilised and improved the business significantly. The new management team members have settled in and with the funding now complete, we are well placed to execute our growth strategy for 2022 and beyond.
“The Parsley Box team comprises experience, commitment, inspiration, creativity, and leadership – the skillset for business growth. We are confident and excited about the future, and the team and I are determined to build on the current stronger foundations to expand and grow.
“I would like to thank our staff for their hard work during the year. I am incredibly proud of everyone at Parsley Box and how they adapted to the disruption caused by COVID-19 and for their efforts in an extraordinarily busy year having listed in March 2021.
“I would like to also thank our customers for their continued loyalty and support, our suppliers for rising to the challenges in a difficult year in the food manufacturing industry and our shareholders who have continued to support the company.”