Oliver’s CEO reckons ‘we’ve turned things around’ as shares rocket 77pc
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By chairman Nick Dower’s own admission, Oliver’s Real Foods (ASX: OLI) had lost its way.
Inefficient operations, poor overheads and flagging sales led to the business recording a series of losses.
Investors sent the stock falling from its 30 cent IPO price to as low as 2 cents yesterday. Back in March, Dower told investors he believed things could be turned around.
Today he has been proven correct with the company now expecting to break even this quarter by eliminating cash burn. Shares jumped as high as 77 per cent up in the morning’s trade, settling at 3.4 cents at 2pm – a 54 per cent increase.
While Oliver’s does anticipate a loss this financial year of $5.3 million due to a poor performance in preceding quarters, it believes it will return to profitability in 2020.
Stockhead spoke with CEO Jason Gunn, who said he was thrilled with the result. He noted while Oliver’s were confident its work was bearing fruit for some time, it wanted to be sure the estimated financial effect was accurate.
He put the result down to eliminating unnecessary costs and “focus[ing] on the business rather than head-office bullshit”.
“The only place we make money is in our stores and that’s where our daily sales increased,” he said.
The company promised shareholders it would be an exciting time ahead.
“The board believes the 2020 financial year will see a return to profits, and with it the ability to pursue a number of very exciting and potentially viable opportunities, which we will advise on, as soon as any of these have been fully explored and investigated,” it said.
Gunn told Stockhead said while the focus would primarily be stabilising the business, he hinted once this was complete there would be opportunities for new products and operations. However, he stressed they would be “of the right calibre”.