Changing habits among tea lovers in the wake of the end of pandemic restrictions sent DavidsTea online sales plummeting in the second quarter, as total revenue fell 18.7% and forced the retailer to post a net loss of 4.8 million.
Posted at 5:50 p.m.
The Montreal retailer achieved a turnover of 15.23 million for the quarter ended July 30, while its sales had been 18.74 million during the same period a year earlier.
Online sales fell 43.9% to 8.3 million in the most recent quarter, compared to 14.8 million for the same period last year. Their share of total sales fell from 79.1% last year to 54.6% in the most recent quarter.
This decline was partially offset by a 238% increase in wholesale sales, particularly with grocery store and drugstore chains, and by 35.5% growth in store sales. The proportion of wholesale sales increased from 4.3% last year to 17.8% in the most recent quarter, and that of store sales increased from 16.6% to 27.6%.
DavidsTea reported a net loss of 18 cents per share, which compared with net income of 75.5 million, or $2.75 per share, for the second quarter a year earlier. Last year’s result, however, included a non-recurring gain of 75.6 million recorded under activities related to the company’s restructuring plan.
Excluding one-time gains, DavidsTea’s adjusted net loss was $3.5 million and compared with an adjusted net loss of $2.0 million a year earlier.
“After successfully weathering the COVID-19 pandemic, we now face additional headwinds, including growing inflationary pressure and recession fears, which are affecting consumer habits,” the CEO said in a statement. DavidsTea management, Sarah Seagal.