Company issued second profit warning in 5 months last week
Analysts unsure over plans to ramp up ready meal business
Details expected alongside 2023 results on Friday

GDANSK, March 13 Reuters HelloFresh needs to cut costs and stem an exodus of mealkit subscribers to boost profits and revive its share price, according to investors and analysts, who remain to be convinced by a plan to expand its fledging readymeals arm.

The German mealkits maker shocked markets on Friday with its second profit warning in five months, citing higher marketing expenses and the cost of ramping up its readytoeat business. The shares plunged by almost 50.

The company once a pandemicera darling also announced a strategy revamp, including plans to beef up its readymeal delivery arm to offset flatlining revenue at its core mealkit business. It lost more than a million active customers in both during the first nine months of last year.

It set a goal to boost revenue from ready meals, which analysts estimate make up 20 of sales, by 50 in 2024. That would be the second year of such growth. It also pledged to cut costs, including on marketing, and use more automation to improve productivity.

Union Investment, HelloFresh39;s 12th largest shareholder with a 2.9 stake, said the reboot was management39;s last chance to restore credibility.

If this does not succeed, a change will be urgently needed, Union39;s portfolio manager Christian Reindl told Reuters.

CEO Dominik Richter will be under…