MySale plunges as Australian tax issues spark profit warning

(Sharecast News) - MySale Group's shares plummeted on Tuesday after the company warned that "challenging" conditions meant it now expected to record an interim underlying loss.In addition, a statement from the international online retailer said that revenue and profits for the financial year to 30 June 2019 will be significantly below market expectations, though second half performance is expected to improve due to measures to reduce costs and improve margins.Chief executive Carl Jackson said: "We are very disappointed in the performance during this year's peak trading period. In response to this underperformance we have significantly accelerated and expanded our existing plans to streamline the business, reduce the cost base and make changes to the product strategy."Changes to general sales tax regulations in Australia, the group's largest market, represented the greatest challenge of the period, which was then exacerbated by product mix and an insufficient proportion of inventory being located in a local distribution centre.In response, the AIM traded company said all senior management and product teams will be centralised in the Sydney head office to facilitate more local sourcing and margin improvement."The group has strong balance sheet and the anticipated improvements in working capital are being achieved and cash balances are increasing. The reconfigured business will be stronger, more efficient and continue to provide a compelling consumer offer and deliver unique solutions to our brand partners,'' said Jackson.The group is also reviewing its operations in the UK and South East Asia, which represented approximately 15% of total revenue last year, and is considering strategic disposals.MySale's shares were down 46.48% at 19.00p at 0852 GMT.