The oatmilk manufacturer will simplify its product portfolio and reduce operating costs in Asia in a bid to bring revenues in line with stronger performing EMEA and Americas markets
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Oatly’s total second quarter sales grew 10% year-on-year to reach $196m | Photo credit: Oatly
Oatly has initiated a comprehensive improvement plan to reverse slowing sales across Asia.
Publishing its second quarter results for the three months ended 30 June 2023, the Swedish oatmilk manufacturer reported a 15% year-on-year declines decline in Asia market sales to $37m.
CEO Jean-Christophe Flatin said Oatly needed to adapt to changes in consumer behaviour in Asia and will develop its core business before seeking further growth.
Oatly’s improvement plan includes simplifying its product portfolio and introducing new measures to reduce operating costs.
The Malmo-based oatmilk manufacturer faces increased competition from Singapore’s Oatside, which, secured $65.5m Series A funding in September 2022 to expand its production output across Singapore and the greater Asia-Pacific region. In June 2023 value-focused Flash Coffee announced it will serve Oatside as the default in all milk-based beverages across its 24 outlets in Singapore.
“As Asia has transitioned to a post-pandemic era, consumers have behaved differently than we had originally expected, and we need to adjust. Similar to the improvement plans that we have been executing in EMEA and Americas, we have initiated a comprehensive improvement plan that will enable our Asia business to adapt to the evolving environment and strengthen the core business before building a significantly bigger business,” Flatin said.
Oatly’s total second quarter sales grew 10% year-on-year to reach $196m, with its EMEA and Americas segments achieving 17.6% and 19.4% sales growth respectively.
The Malmo-based oatmilk manufacturer said growth was primarily driven by price increases implemented across the Americas in the third quarter of 2022 and across the EMEA region in the first quarter of 2023.
Additionally, Oatly said sold volume for the second quarter reached 125 million litres, up from 121 litres during the same period of 2022.
Flatin was appointed Oatly CEO in May 2023 and has been tasked with steering the business to profitability in 2024. Oatly posted an EBITDA loss of $63m for the second quarter, compared to an EBITDA loss of $62.6m for the same period of 2022.
Marie-Jose David will assume the role of Chief Financial Officer at Oatly on 1 October 2023. Announcing her appointment, Flatin said David’s two decades of global finance and leadership experience will be key assets in Oatly’s pursuit of profitable growth.