Originally Posted by
Beagle
Really breathtaking when you look at it like that.
You have a choice whether to believe or not.
Sales by half year to:-
30 June 2020 $923m
31 Dec 2020 $677m
30 June 2021 $533m F (Assumes they meet the bottom end of their forecast of $1.2 billion annual sales.
That's quite a trend to try and stop. In FY20 they spent $194m on marketing to grow and generate revenue of $1.73 Billion, more than 11% of gross revenue which is huge. Despite this we have seen a massive decline in revenue and the board signaling the need for a significant increase in marketing going forward. WOW !
Food for thought. If they are going to spend something like $225m on marketing in FY22 to try and "stabilize the ship" and stop the erosion of market share and suppose they do stop the bleeding and they achieve sales of 2 x $533m = $1,066m in FY22, that's still a reduction on FY21 sales and what does all that marketing spend do to margins in FY22 ?
On top of that there's old inventory issues rolling into FY22. Maybe Forest is right and all we can expect is a break even result in FY22 ?
More food for thought. After 4 quite spectacular downgrades surely there must be questions about the credibility of any forecast this company issues ? What credibility should we attach to their new sales forecast of $1.2 - $1.25 Billion for FY21 if any ? Is there a fifth downgrade coming and would 5 downgrades be some sort of wooden spoon record for any company listed on the NZX ?