Moonpig has reported a loss in the first half of its financial year, as the personalised card maker’s experiences business takes longer than expected to recover. The FTSE 250 company’s share price fell by 12 per cent in early trading on Tuesday, despite shares remaining up by 57 per cent this year.
Moonpig posted a pretax loss of £33.3m for the six months to 31 October, 2024, compared to a profit of £18.9m during the same period last year. The loss was attributed to a £56.7m goodwill impairment related to its experiences business, which partners with brands such as Slug and Lettuce, Hello Fresh and BrewDog, as reported by City AM.
The firm cited “challenging trading conditions” and “trading conditions remain challenging with significant macroeconomic headwinds” impacting the unit, leading to an extended timeline for aligning experiences revenue growth with its full potential. A “transformation plan” for experiences is reportedly operationally complete and has realised over £1m in cost savings, including relocating its head office, outsourcing non-core functions and building a new leadership team.
Basic earnings per share for Moonpig dropped to a negative 11.2p for the half year, compared to 4.1p a year earlier. On an adjusted basis, Moonpig’s profit came in nine per cent higher at £27.3m.
The company has elevated its medium-term forecast for adjusted pre-tax earnings (EBITDA) margin to between 25 and 27 percent, up from the previous range of 25 to 26 percent, an uplift attributed to “continued growth of high-margin revenue streams such as plus subscription fees” Moonpig recorded a revenue of £158 million for the six months, marking an increase of 3.8 percent year-on-year.
The postal card company, along with its Dutch counterpart Greetz which was acquired in 2018, registered approximately 200,000 new active customers during the half-year period, taking the total to 11.7 million. “Moonpig’s performance has been underpinned by robust growth in order volumes, powered by our multi-year investments in technology and innovation and the structural market shift to online,” commented Nickyl Raithatha, Chief Executive of Moonpig.
Raithatha also highlighted that the company’s “roadmap of innovative features” was set to include “leveraging emerging AI technologies to enhance the card-giving experience”.