Shares in iSelect fell more than 55% yesterday after the online comparison website slashed estimated 2017-18 earnings and revealed that Scott Wilson, the CEO of nearly five years had gone.
The shares fell 55.5 cents or 55.5% to end at 44.5 cents.
iSelect, which is compares and sells health, life and car insurance policies; mortgages; and energy contracts, broadband deals and financial referral services, cut its underlying earning estimate to between $8 million and $12 million for the full year, well down on its previous guidance of $26 million to $29 million.
The previous guidance was a a significant upgrade from the 27% rise in underlying earnings for 2016-17 to $16.4 million. It lifted underlying profit 23% for the six months to December 201`7 to $3.5 million and maintain the forecast for a big second half.
That failed to turn up with iSelect revealing in yesterday’s update that trading in the last two weeks of March and the first three weeks of April was below company expectations amid volatile markets, fewer leads and higher digital customer acquisition costs.
iSelect said that its health insurance, energy and telecommunications businesses had been impacted by market volatility and lower-than-expected leads.
iSelect said it is reviewing its marketing strategy to address the issue of fewer leads. Health insurance experienced softer overall demand in the wake of low industry-wide premium increases and ongoing affordability issues.
The energy and telecommunications segment was affected by higher digital customer acquisition costs, but life and general insurance had been performing to plan.
iSelect said it will start a search for a new chief executive after Scott Wilson tendered his resignation, ending five years at the company.
In a statement the board thanked Mr Wilson for his contribution and said it "wishes him all the best in his future endeavours".
Independent non-executive director Brodie Arnhold, who is also chair of the audit and risk committee, will be the acting chief executive.
