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Real Good Food expects full-year loss of up to £3.5m
Shares in AIM-listed diversified food business Real Good Food slid on Wednesday after the company said it now expects to make a full-year loss following weaker-than-expected trading late last year.
The company said sales in the early part of the Christmas trading quarter were "largely satisfactory", but its performance in the last few weeks of the year was "materially" below its expectations, mostly due to a disappointing performance in UK grocery retail and de-stocking in overseas markets.
In addition, it is currently undertaking a review of the various balance sheets of the group companies to ensure their accounting treatments are consistent across the group and accord with good practice.
As a result of this review and of a reforecast exercise within all the operating businesses, along with the poorer-than-expected trading late in 2017 and early in 2018, Real Good food now expects outturn for the year to be an earnings before interest, taxes, depreciation and amortisation loss of up to £3.5m.
"Looking more widely at the prospects for the company, there are clear signs that the considerable investment made throughout the group in the past eighteen months is beginning to yield benefits. A turnaround plan has been formulated and is now in the process of being implemented by the new management team to reverse the negative performance trend and to begin to deliver the sort of returns that investors should more reasonably expect over the medium term."
The company added that its major shareholders remain fully committed and supportive of the turnaround plan and its implementation.
At 1100 GMT, the shares were down 16% to 19p.