These issues were compounded further by protracted impacts from COVID-19.
Interim chief financial officer Jeff Sells said the total ERP upgrade is a significant change management program for any company.
“Whilst we reached go-live on this project broadly on budget and on time through a pandemic, we have faced additional challenges in the context of completing implementation through the height of COVID-19 restrictions,” he said.
“Unfortunately, this has had some significant impacts on our customers, and we are rectifying these issues as quickly as possible. The combination of these factors in the second half of FY22 have materially impacted sales and resulted in an unexpected increase in operating costs through the transition.”
Mr Sells added that as a result, the company’s peak net debt would be impacted, and while actions were under way to address the technical difficulties, sales in fiscal 2022 would be affected, flowing into next year.
“The impact [is] expected to abate as we progress through FY23,” he added.
Mr Sells stepped back in as interim CFO in November after Jackie Pearson flagged her departure from the role in late October.
Long-serving CEO Mark Hooper also resigned from the board of directors in October after flagging his departure earlier. Mr Hooper was scheduled to leave Sigma by October but had agreed to stay until January.
Chairman Ray Gunston said despite the setback, he was confident in the future growth profile for Sigma, pointing to the recently approved extension to its new Victorian Distribution Centre in Truganina.
“This will see $20 million invested to double existing capacity to 40,000 square metres to accommodate the growth pipeline ahead. The extension is expected to be completed over the next 18-months,” Mr Gunston said.
“Sigma has undertaken an extensive transformation program over the past four years that puts the company on a strong footing for our incoming CEO Vikesh Ramsunder to execute our strategy, focusing on actions to accelerate our long-term growth and improve margins.”
Sigma said it now expects to announce its full-year 2022 results on March 29, 2022.
More to come
