HelloFresh cuts profit forecast as sales fail to deliver

HelloFresh has cut its profit outlook for the full year due to declining sales and a strengthening euro.

The meal kit maker now expects its full-year adjusted core profit (AEBITDA) to fall between €415-€465m, down from a previous range of €450-€500m.

HelloFresh’s share price has already fallen around 30% this year and almost 90% since its peak in 2021.

Revenue was down 9.8% to €3.6bn in the six months to 30 June, mainly driven by a 12% decrease in order numbers plus a recent weakening of the dollar against the euro. The company makes around two-thirds of its sales in North America.

HelloFresh said the decline in orders was driven by its focus on “acquiring less, but higher quality customers”, although a softer-than-expected consumer environment, particularly in North America, also impacted customer acquisitions.

The company has now launched a multi-year strategy called ‘The Refresh’ to try and recover its fortunes.

This will see it invest €100m in upgrading the quality, variety, and personalisation of its meals, alongside expanding the number of options across meal kits and ready-to-eat.

“The flywheel is clear: cost discipline funds product innovation; great product drives retention and LTV; retention unlocks profitable growth at scale,” the company said.

HelloFresh launched its ready-to-eat products as its meal kits began to drop off. However in the second quarter, these too fell 6% compared with the same period last year.