Cherry drops profit forecast on ComeOn integration issues
Operator revises FY2017 revenue and EBITDA forecasts after “incorrect marketing decisions” and slow integration
Cherry AB has revised its full-year financial forecast for 2017 as a result of continued integration issues with its online business ComeOn.
In a company statement group CEO Anders Holmgren said full-year revenues had been revised to 2,200 MSEK (£196.6m) from 2,500 MSEK (£223.5m).
Additionally, the firm anticipates EDITDA earnings of 400 MSEK (£35.7m) for 2017, over the initially predicted 480 MSEK (£42.9m).
Holmgren said the integration of ComeOn had not been implemented according to plan.
He also said “incorrect marketing decisions” had contributed to higher costs and worse earning trends than initially planned.
As a result of the setback, the company recently rejigged ComeOn’s senior management team, with longstanding CEO Jonas Wahlander stepping down from his role last week.
“We have appointed a new management team, consisting of persons with the experience, market insight and control required,” Holmgren said.
Despite the setback, early Q3 figures revealed a 6% boost in EBITDA margins to 20%. The group also recorded overall Q3 revenues of 567 MSEK (£50.6m), up 165% year on year.
The operator’s shares were down almost 10% this morning, with full interim results for Q3 expected next Wednesday.