Quick service business Oliver’s Real Food saw ‘ongoing economic uncertainty’ result in weak retail spending over the Christmas and holiday season, with trading having not been as strong as was expected over the quarter ended 31 December 2018.
Initiatives to boost foot traffic, such as lowering prices and introducing new products, helped to buoy the business but didn’t necessarily translate to greatly increased customer numbers.
“Although the Directors are very disappointed with the Company’s performance, we believe that the operational and organisational changes that are being rapidly implemented will improve performance at all levels of Oliver’s operational footprint,” Oliver’s chairman Mark Richardson said.
“We must allow time to realise the benefits of the changes over the coming months and for these to flow through to performance and profitability.”
Oliver’s made the decision to close the store in Dubbo on 28 January, and is reviewing the performance of all other stores, expecting to close further stores based on poor trading, high rent commitments and local economic influences.
Looking toward the remainder of FY19, the business downgraded its expected sales revenue to fall within the range of $34 and $38 million, likely to deliver an EBIDTA loss of between $1 and $4 million.
This contrasts with the revenue guidance put forward in November 2018, in which the business noted it expected between $40 and $43 million, which would create an positive EBIDTA of $1 to $1.5 million.
“The Oliver’s brand is young and still offers incredible potential,” Oliver’s chief executive Greg Madigan said.
“If we continue our consolidation, improving the current portfolio and resolving sales and profitability challenges in subdued trading conditions, we will be in an incredibly strong position to move forward and expand, realising the potential we all know the brand possesses.”
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