HelloFresh expands ready-meal business to Sweden and Denmark

German meal-kit maker HelloFresh HFG said on Thursday it was launching its fledging ready-to-eat business in Sweden and Denmark as the company seeks offset falling revenue from its meal-kit subscriptions.

WHY IT MATTERS

HelloFresh's meal-kit business is struggling due to inflation and changes in customer habits, prompting the company to focus on its ready-to-eat business, hoping to attract new customers.

Investors have questioned if the new business can make up for the loss of meal-kit revenue and criticised the costs required in breaking into new markets given stiff competition from takeaway services, online grocery stores and supermarkets.

The company set a goal to boost revenue from ready meals, which analysts estimate make up 20% of sales, by 50% in 2024.

BY THE NUMBERS

The new countries are the latest after HelloFresh launched in the United States in 2020. It has opened in Canada, Belgium and the Netherlands since last year.

CONTEXT

The Berlin-based company has issued two profit warnings since November flagging lower-than-expected sales growth, higher marketing expenses and the costs of ramping up its ready-to-eat business. The shares have lost about 80% of their value since mid-September.