Anglo-Australian flash Sale business MySale Group is taking “immediate action” after its group revenue dropped 17% year on year to A$126m (£67.8m) for the six months to 31 December 2018.
The company reported an underlying EBITDA loss of A$5m (£2.7m) for the period. Gross margin reduced to 23.4% from 30.1% in the first half of its 2018 financial year.
The lower than expected results reflect significant changes to the tax rules in Australia and New Zealand. Changes in GST legislation for low-value e-commerce import transactions were a primary factor, according to the company.
MySale Group CEO Carl Jackson, who co-founded the business with his brother, Jamie, said: “Performance during the first half was disappointing, however we took immediate action to address the issues the group faced.
”Our technology platform’s capabilities allowed us to streamline and automate the business, delivering significant cost savings, albeit more slowly than envisaged, with more to come before the end of this year.
“The changes to product strategy, while still ongoing, will be completed in the second half of the current financial year and should stabilise revenues and improve gross margin.”
He added that these changes have led to reductions in revenue and profitability for a longer period than expected and the financial performance for the full year is now expected to be “materially below previous guidance”. However, the group expects to return to positive underlying EBITDA by the end of the 2020 financial year.