Bert Alfonso has stepped down from his chief executive role at Yowie Group (ASX: YOW) as the company cuts its sales guidance for the 2018 financial year from 55% to 17%.
Head of Yowie North America and global chief operating officer Mark Schuessler has filled Mr Alfonso’s position with Mr Alfonso to assist with the handover.
The fall in guidance is due to flat sales across the US and Canada with December quarter sales in the US sitting at US$4.4 million, unchanged from the previous corresponding period.
Meanwhile, sales in the US during the December half year tumbled more than 11% on the previous 2016 period.
Yowie has attributed the lagging sales to a “disappointing” Discovery World launch, its later than expected foray into Canada’s market, and the company’s largest US customer scaling back.
However, in Australia, December quarter sales were US$1 million and on plan, with half year sales in the region 15% above target at U$1.8 million.
As a result of the flat US sales, Yowie anticipates sales growth for the 2018 financial year to sit at 17% higher than 2017 levels – scaled back from the original 55% forecast.
Despite the “disappointing” cut to guidance for 2018, in the 2017 financial year, Yowie increased its net sales more than 50% and generated A$19.5 million in revenue.
Additionally, the company’s gross margin for the December quarter was 55%, which is in line with previous quarters.
To assist its growth, Yowie has invested in efficiency improvements and marketing to build its brand awareness in the US and Australia. In mid-December 2017, Yowie reported several US retailers had signed up to distribute the product and the company anticipates this will generate higher sales in the first half of 2018.
Yowie is a chocolate confectionary that comes foil wrapped and one of six characters. Inside the chocolate is a capsule containing a replica animal or Yowie playmate with a leaflet about the animal, its habit, food sources and conservation status.
Shares in Yowie tumbled on the news and were down almost 30% by early afternoon trade at A$0.15.