Amid a tumultuous year, with fewer deliveries and trading challenges, meal kit home delivery service My Food Bag (ASX: MFB) CEO Kevin Bowler announced overnight that he is resigning from his position.
After having joined the Company in June 2018 as its first independent CEO, Bowler took inventory of the matter in hand (think: lower earnings and poor financial forecast for the year) and decided to step down.
My Food Bag’s Chair, Tony Carter, shared, “Kevin successfully led the business through the COVID-19 pandemic, which delivered a number of significant challenges, including heightened health & safety risks, supply chain disruptions, rapid periods of growth and high inflation.”
Carter acknowledged that the Company has been having a less than ideal year. Bowler’s resignation further reveals the cracks in the Company’s performance. Carter added, “It has been a challenging time for My Food Bag and despite this, with Kevin’s leadership, the business has performed well, transitioned to a publicly listed company and is investing for the future.”
To Bowler’s credit, Carter shared that during the CEO’s tenure, My Food Bag took control of national operations from third parties, opened two new assembly facilities in Auckland and Christchurch and added more recipe choices, meals and grocery options for customers. Since 2018, My Food Bag tripled its earnings, increasing 24% on FY20 in May 2021.
Unfortunately, this year, the Company transitioned from being ‘My Money Bag’ to ‘My Money-pit Bag’ owing to Covid-induced disruptions and falling demand.
As people began downsizing this year owing to rising prices, My Food Bag received the smaller end of the stick. Customers set their eyes on smaller bags, thus unfavourably impacting My Food Bag’s product mix.
Add to that the staffing problems and supply challenges faced by the Company. To address these issues, the Company had to simplify its product offerings and reduce marketing activity, which further hurt its financial performance. So much so that EBITDA was down approximately 8.5% on the previous year.
On his departure, Bowler commented, “I’m sad to be leaving My Food Bag, but I know that the time is right for my family and me.”
“When I look back at my time with the business, I’m most proud of the way our team has worked together tirelessly through the uncertainties of the pandemic and still achieved all of its prelisting forecasts in the FY21 and FY22 years. This was done while keeping each other safe and doing our bit to support Kiwis in lockdowns and periods of isolation across the motu,” he said.
Now however, as people head back to supermarkets, the outlook for meal delivery services appears bleak. In fact, since listing on the ASX in March 2021, the Company’s share price has fallen consistently, going from $1.65 during the opening to $0.60 as of September 2022.
Bowler’s final day in office will be October 14, 2022. The Board is on the hunt for his replacement as Chief Financial Officer Mark Winter puts on the hat of interim CEO.
Alinda is a Business Reporter for The Sentiment
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1 Comment
Maxwell
One could be excused for believing in Karma given the shanigans surrounding their IPO , the behaviour of their management team and organising brokers.
Not suggesting anything illegal , but in my 50 years of investing , the 80’s and early 90′ s exempted I have never witnessed,what in my view was such,despicable behaviour towards the treatment directed towards their shareholders.
How the 3 brokers involved in valuing the company prior and immediately after MFB listed arrived at $1.85 – $1-91 must have been looking at different figures than those of mine, unless of course they had a a hidden agenda.?
History has proved me right.
The position MFB finds itself in today ,in my humble opinion, was so predictable from day one. Now I wonder if behind the scenes with recent appointments if there is not a power struggle about to erupt.?
I never did get a response from the FMA or my broker to questions I put to them expressing my concerns at what I saw as shortfalls in the manner in which MFB was listed.
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