German meal kit company HelloFresh SE (HLFFF) reported Tuesday weak adjusted EBITDA, a key earnings metric, and margin in its fiscal 2024, despite higher revenues.
Looking ahead, for fiscal 2025, the company targets to meaningfully increase AEBIT (pre impairment) on Group level to 200 million euros to 250 million euros from 136 million euros in 2024, representing an around 65 percent increase at the midpoint of the outlook range.
AEBITDA on Group level would increase to around 450 million euros to 500 million euros in the fiscal year 2025 from 399 million euros in 2024.
The Company estimates a decrease in constant currency revenue of the HelloFresh Group between 3 percent and 8 percent.
Dominik Richter, co-founder and CEO of HelloFresh, said, "Driving strong AEBIT and free cash flow performance will enable us to make strategic investments in our product quality, variety and deliciousness in 2025 and beyond. We are confident that leveling up the customer experience and product will contribute to higher retention of existing customers, and to unlocking new customer segments for the Group."
Further, the company said its management board has decided to expand the comprehensive efficiency program initiated in the second half of 2024 and to extend it until 2026.
In the full year 2024, adjusted EBITDA or AEBITDA was 399.4 million euros, lower than last year's 447.6 million euros, but at the upper end of its previous outlook for the full year.
AEBITDA margin was 5.2 percent, down from 5.9 percent a year ago. The company said it recorded strong year-over-year progress in profitability in the second half of the year.
The meal kit product category achieved an AEBITDA margin of 14.1 percent in the fourth quarter, up from last year's 11.4 percent. The margin was 9.8 percent in fiscal 2024, up from 9 percent a year ago.
The Ready-to-Eat or RTE product category achieved an AEBITDA margin of 5.3 percent in the quarter, compared to last year's negative 4.2 percent. In the year, margin was 1.6 percent, down from 4 percent a year ago.
Group revenue for the year amounted to around 7.66 billion euros, higher than prior year's 7.60 billion euros. Revenues edged up 0.9 percent in constant currency.
The company will publish its annual report for the fiscal year 2024 as scheduled on March 13.
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