Shares of Edinburgh-based ready meals firm Parsley Box Group plc fell almost 40% on Thursday after it published a trading update that showed 18% year on year revenue growth — but also revealed “labour issues throughout its supply chain” and restricted stock availability.
Parsley Box joined the stock market in March this year at £2 per share — but the shares are now trading around 61p.
Parsley Box serves the “Baby Boomer+” demographic.
“The group has recorded 18% year on year revenue growth for the 8 months to 31 August with revenues of £17.8m (2020: £15.1m),” said the company.
“Products shipped also grew by 18% in the same period to 7.8 million units (2020: 6.6 million).
“The group, together with the wider retail sector, is experiencing labour issues throughout its supply chain and has been significantly restricted by stock availability at circa 50% of plan.
“Customer service is a core value of the group, and therefore the board took the difficult decision to reduce investment in marketing, and this is likely to continue until the expected short-term supply chain constraints recede.
“As a consequence the group now expects full year revenue to be circa £25m, slightly ahead of last year, with a consequential impact on the group’s loss before tax.
“The group’s cash balance at 31 August 2021 was £5.7m.
“The board is encouraged by the early signs from the Q3 product releases and will provide a further update ahead of the full year close.”
Parsley Box CEO Kevin Dorren said: “Delivering our product innovation plan remains the focus for the business as we navigate our way through the widely reported supply chain disruption.
“The second half of the year has been further impacted as we took the disappointing decision to pull back on planned marketing investment.
“However I, and the board, firmly believe that Parsley Box’s long term growth prospects are unchanged.”