Reporting Season Round Up: Vita and Lynch both got knocked around by COVID-19 lockdowns
Link copied to
Vita Group is best known for operating the Telstra store network, but this year the big telco made the call to take its stores back into its own hands.
Nonetheless Vita also operates a network of skin clinics under the Artisan brand. It first entered into the space in 2017 and now it is the company’s primary business.
Today VTG forecast its half yearly profit would be $12.5-$12.9 million — down 15-17% down from the prior year.
It blamed the store closures between July and October but told shareholders it was laying the foundations for a better future.
“We see great opportunity in the aesthetics category, which has characteristics reminiscent of the mobile phone industry during its early growth stages – we have a clearly defined strategy and now have the time and focus to execute it,” said CEO Maxine Horne who will soon depart from the business.
Vita shares fell 7% this morning and have more than halved in the last 12 months.
After impressing shareholders with record sales in FY21 which exceeded prospectus forecasts, this company revealed a hit from COVID-19 restrictions in its morning announcement.
Furthermore, it reported the “bounce back to normal” was taking longer to work through than in 2020, and that it had been experiencing difficulties with international freight availability given the lower number of passenger flights to Australia.
But like Vita, Lynch said better times were ahead noting it would have its new processing facility in China complete and operational by the end of January and it would increase its greenhouse space as well.
In spite of the hit, the company stuck with its profit guidance for the 2021 calendar year of $31.6 million to $32.6 million, arguing the key event window between Chinese New Year and Mother’s Day would more than make up for the impacts of COVID-19 restrictions.
Lynch Group shares initially fell 9% this morning but recovered to yesterday’s price by 11am. Shares are currently trading at a slight discount to its $3.60 IPO price.