Oatly shares have crashed once again as the embattled plant-based group drastically cut its sales outlook for the year as Asian markets recovered slower than expected from the pandemic and losses widened.
The oat milk producer now forecasts revenue growth for 2023 in the range of 7% to 12% year on year, down from the 23% to 28% jump it predicted at the time of its annual 2022 results in March.
Shares sank 26% to $1.61 as markets in New York reacted to the downgrade, with the group now valued at less than $1bn (£779m).
Oatly launched a “comprehensive” improvement plan for the Asia business, including increasing focus on the core business, a simplification of the product portfolio and a reduction in operating costs.
It also announced actions to further simplify its corporate functions and overheads in the Americas region in a drive to make more cost savings.
Revenues at the Swedish group increased 10.1% in the second quarter to $196m (£152.6m), but double-digit growth in the EMEA and Americas regions was offset by a 14.9% fall in Asia sales as volumes and price both decreased.
Net losses in the quarter grew to $86.7m (£67.5m), compared with $72m (£56.1m) a year ago, while pre-tax losses for the first half remained broadly flat year on year at $160.6m (£125.1m).
Oatly said it remained on track to achieve positive adjusted EBITDA in 2024.
“In the second quarter, we continued to make progress towards our goal of achieving profitable growth in 2024,” added CEO Jean-Christophe Flatin, who took over from Toni Petersson in June.
“However, as Asia has transitioned to a post-pandemic era, consumers have behaved differently than we had originally expected, and we need to adjust. Similar to the improvement plans that we have been executing in EMEA and Americas, we have initiated a comprehensive improvement plan that will enable our Asia business to adapt to the evolving environment and strengthen the core business before building a significantly bigger business.”
The second-quarter trading statements marks a major setback for the struggling group following more positive news in 2023.
Shares in Oatly rallied in March when the business announced better-than-expected annual figures, promised future profitability and made bullish growth forecasts for the year ahead.
In May, when it announced Flatin would take over as the new boss, the business also revealed improved profitability following a “solid start” to the financial year.
Today’s news is the latest disappointment for Oatly investors. After floating on the Nasdaq Exchange in New York in May 2021 at a valuation of $10bn, the stock rocketed to highs of $29 a share before sinking to a low of $1.36 in December 2022.
The collapse in value followed a string of disastrous trading updates, ballooning losses, growth downgrades and supply chain problems in its US factories.
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