The news followed a 10-week strategic review of the business by RGF’s new management team, appointed in the wake of a number of directors – including founder and executive chairman Pieter Totté – leaving the company.
RGF said: “It was recognised that group and head office costs have been too high and these are also subject to a comprehensive review, part of which will result in moving the head office from London to Wavertree, Liverpool.
‘Significant additional costs’
“The company has also experienced significant additional costs from professional advisers as a result of needing to respond to its corporate governance and regulatory shortcomings.”
RGF reported a pre-tax loss of £6.4M in its full year results last month, compared with a profit of £12.8M last year.
The company also expected it would make a loss in its next full-year results, down from its earlier predicted earnings before interest, taxes and amortisation (EBITDA) of £6.5M.
RGF added: “Following a review of the company’s performance [for the first half of the year] in its latest monthly management accounts, the board has decided to take a more prudent view of its anticipated performance in the second half of the year.
‘The company will report a loss’
“As a result of this more prudent view, the board now expects a materially reduced level of EBITDA in the second half of this year and in the year to March 31 2018 as a whole. The board now expects that the company will report a loss before tax.”
In August, the company’s share price dropped 42.5% in value to 20.7p, its lowest since May 2010.
RGF’s will hold its AGM at its Liverpool site on Thursday (October 26).
Meanwhile, last month, RGF launched a full review of its financial reporting and corporate governance, after it was revealed that former directors had received payments for consultancy services, not reported to the company.
Real Good Food’s full year results – at a glance
For the year ending March 31 2017
- Operating loss of £6.4M before tax
- Sales of £108M
- Earnings per share at a loss of 8.5p