Angling Direct PLC (AIM:ANG) saw its shares plunge after the company cut its forecasts for the current year as it reported a sharp drop in first-half profits and said trading conditions remain tough.
The fishing tackle specialist revised down its revenue and underlying profit (EBITDA) forecasts for the year to January 31, 2023, to not less than £73.8mln and £2.2mln, respectively. That is below the current market consensus for revenues of £78.5mln and EBITDA of £3mln.
In the company's half-year to July 31, 2022, revenues were £38.9mln, up 1.3% compared with the same period the year before, with retail store sales growing 9.8% but online sales falling 7.9% against strong comparatives.
EBITDA more than halved, dropping 58.2% to £1.9mln, reflecting the end to COVID-19 government support. Pre-tax profit dived by nearly 70% to £1.1mln.
After the period-end, Angling Direct said its sales were hit by the unprecedented heatwave which caused some fishery closures and led to sales in the peak trading month of August falling 7% year-on-year.
Although sales returned to modest growth in September, trading conditions have been unpredictable with significant changes week-by-week, the company added.
“The general market outlook has deteriorated further in recent weeks which creates a heightened degree of uncertainty and makes short-term forecasting extremely challenging,” it noted.
The company said it remains well capitalised and securely positioned to meet short-term challenges, with net cash as of end-July at £17.7mln, compared with £19.6mln a year earlier.
Angling Direct shares fell by 12.5% to 28.00p in early morning trade.