Gale Pacific Limited FY24 Earnings Update.

GALE Pacific Limited (ASX: GAP) announced updated guidance for FY24. The Company anticipates revenue of AU$172 million to AU$174 million and a profit before tax of AU$1 million to AU$2 million for the 2024 financial year. This is a change from the previous guidance, which had indicated that revenue for FY24 would exceed the FY23 revenue of AU$187.6 million and that the profit before tax for FY24 would be higher than the FY23 result of AU$5.3 million. Several factors have influenced this change in performance. Lower-than-expected sales have been recorded by retail customers across the United States since mid-April due to the macroeconomic impact on consumer sentiment and spending—continued destocking of inventory by retailers across the US.

Higher-than-expected implementation costs, amounting to approximately AU$4.9 million, for the Company's new ERP system. However, it is important to note that some positive factors have significantly offset the negative demand and cost issues in the second half of the year. These include increased distribution and successful new product launches in the United States in Q3, increased revenue in the Developing Markets region, and expansion in Company gross margins.

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