Booktopia has lowered its full-year earnings before interest, taxes, depreciation, and amortisation (EBITDA) forecast and initiated a strategic review of the business after a decline in the first-half results.
The online bookstore now anticipates annual EBITDA to be between $1 million and $3 million, significantly down from the previous estimate of $13.5 million.
The new guidance came following the conclusion of the second quarter, which traditionally delivers the largest share of the company’s yearly profit.
The company noted that revenue increased during the Black Friday period and that customer basket sizes widened despite cost of living pressures.
However, Booktopia’s transition to a new customer fulfillment centre negatively impacted sales revenue during the first half, due to lower inventory, products running out of stock, and longer delivery time.
Booktopia said it implemented further savings to both fixed and variable costs in the cost base at the end of the first half to right-size for revenue, benefits of which are expected to be realised next year.
Moving forward, the company has also set out several key strategic focuses including improving website experience, optimising inventory, developing the brand in line with changes to the business’ approach, and strengthening customer-centric commitment through personalisation.