Shares in boutique brewing company Moa have plummeted on the stock exchange this morning after the firm warned of a major sales shortfall.



The stock was down 32 cents, or 27 per cent, to 86c in the first hour of trading, wiping almost $10 million off Moa's market value.



Minutes before market closed yesterday Moa said it would miss its sales target for this year by a wide margin.



''Although the year is only four months progressed, Moa estimates a volume shortfall of approximately 30 per cent on the total company [prospectus] target of 195,000 cases,'' it said.



Moa said its New Zealand distributor, Treasury Wine Estate (TWE), had advised that it doesn't expect to now meet the agreed sales volume target for the 2014 financial year in New Zealand, which makes up the bulk of its revenue.



Moa chief financial officer Kelvin Ovington said there were discussions with TWE to end the current distribution arrangement and switch to a new model.



''It's not working and we've mutually agreed to move on,'' he said.



Moa floated on the NZX last November after selling 12 million shares to the public for $1.25 each.

Its prospectus described the TWE relationship as representing a ''significant step in the growth and evolution of Moa.''



Moa was TWE's only New Zealand beer though its distributes in New Zealand on behalf of SAB Miller. The brewer is likely to announce at next Tuesday's annual meeting in Auckland what the new distribution model will be as it was still working through several alternatives.



Ovington said the company had not yet calculated the likely financial impact of the drop in expected sales.

But sensitivity analysis in the company's prospectus said a 10 per cent drop in sales volumes in 2014 would equate to a fall of $339,000 in ebitda (earnings before income, taxation, depreciation and amortisation), implying a potential earnings hit of $1m.



Ovington said a lot had changed since then and the company hoped to give investors an update at the annual meeting.