11.08.21
Global personal care company MAV Beauty Brands Inc. announced its financial results for the three and nine months, which ended Sept. 30.
"We are disappointed with the Q3 financial results, including the non-cash goodwill impairment,” said Serge Jureidini, president & CEO of MAV Beauty Brands. “Third-quarter net sales decreased versus the prior year as we continued to experience the negative impact of net distribution losses from retailer planogram resets, as well as the subsequent customer inventory adjustments.”
Q3 2021 revenue decreased by 22.1% to $24.7 million, compared to $31.7 million in the prior-year quarter. For the Canada/US region, revenue decreased by 23.6% to $22.9 million in Q3 2021, compared to $30.0 million in Q3 2020. The year-over-year decrease primarily reflects the impact of previously disclosed net distribution decreases for two brands, which took effect in the first half of 2021, as well as the resulting retailer inventory adjustments. For the International region, revenue increased by 5.9% to $1.8 million, in Q3 2021 compared to $1.7 million in Q3 2020 due to the continued recovery from COVID-19 in key international markets.
Gross profit decreased 34.3% to $10.3 million in Q3 2021, compared to $15.7 million in Q3 2020. Gross profit margin was 41.8% in Q3 2021, compared to 49.6% in Q3 2020 and 40.1% in Q2 2021. The year-over-year decline in gross profit and gross profit margin was driven by several factors, including increased promotional spend, an increase in supply chain input costs and increased sales of non-core products at lower gross margin. Over time, the Company expects to adjust its pricing to offset some of these higher product input and supply chain costs should they persist.
"With the benefits of the integration of The Mane Choice steadily materializing and multiple process improvement initiatives underway, the organization is gradually improving operational execution across the platform,” said Jureidini. “We are hard at work on initiatives across all areas of the business with this goal in mind. In a market that continues to show signs of recovery, we remain confident in the fundamental strengths of our business – the unique and complementary brand portfolio, the efficiency of a common operating platform, the team's expertise, and our entrepreneurial culture – as we strive to achieve improved and consistent results for our stakeholders."