The 2019 financial year was an eventful one for Oliver’s Real Food (ASX:OLI), the healthy fast-food chain that first listed in 2017.

Along with problems at the operational level, the company went through a contentious split at board level which resulted in a mass-walkout in March.

The net result was a sharp hit to the bottom line, as revenue flatlined while the company’s expenses continued to rise — including a $6.5m impairment charge for underperforming stores.

In its financial results released today, Oliver’s reported a net loss after tax of $15.661m (FY18 loss: $643,000).

The company’s net assets also fell to $11.59m from $23.7m in the prior year, with material writedowns in property and intangible assets.

Oliver’s shares have been suspended from trading since Oct 1 due to the delay in the company lodging its FY19 accounts.

But perhaps not surprisingly in light of its challenges, the stock has fallen steadily from levels above 20c in 2018.

Pitching the turnaround

Oliver’s founder and CEO Jason Gunn was pretty direct in his assessment of the company’s annus horribilis

“There is no way to dress this up, these are very disappointing results indeed,” Gunn said.

Gunn rejoined to the board in March this year, along with his wife Amanda — the same board he was unceremoniously removed from in May 2018 by the directors at the time.

Those same directors all left the company upon his return, and Gunn said he’s now focused on getting the business back on track.

Most of that focus has been on costs, shutting underperforming stores and reducing the company’s cash burn.

First founded by Gunn in 2005, Oliver’s makes pre-prepared meals and offers a range of organic food products. It runs a chain of 25 stores across Victoria, New South Wales and Queensland which are predominantly targeted at customers in transit on main arterial highways.

Gunn said the focus on operational efficiencies meant the company had already returned to positive underlying profits in the first quarter of FY20.

Along with the other board changes, he also touted the hire of new CFO David McMahon as the “most significant and impactful change” at the company, citing inadequate number-crunching as one of Oliver’s most glaring shortcomings.

“There is no doubt that one of the greatest failings of this business since listing, has been our inability to effectively manage, and provide stakeholders with accurate financial data and forecasts.”

 

In other ASX food news today:

The Food Revolution Group (ASX:FOD) provided an update on its 1260sqm production facility in Melbourne, announcing that the project is nearing completion. Sachet machines for both gels & liquids and power will be installed this month. The company will also have a bottling line set up by December. “All new plant capabilities will be operational in December 2019/January 2020,” FOD said. The company is continuing to position itself as a supplier of premium fruit and juice products to China. Shares in FOD were up 7.6 per cent at 8.5c.