Food Revolution Group continues to deliver strong growth
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
The Food Revolution Group Ltd (ASX:FOD) has released a promising update on the latest IRI scanned market data (market reading of consumer purchases from Woolworths and Coles) for the March quarter.
Year-on-year growth across the group of 25.9% was an outstanding performance, particularly given that total market growth was 1.1%.
Once again, the Original Juice Co Brand performed exceptionally well, delivering year-on-year growth of 24.4%.
FOD is benefiting from its strong alliance with Woolworths and Coles, and retail sales growth from those stores increased by 27.2% and 24.5% respectively.
In line with the past three quarters, FOD brands continued to perform ahead of the market in the $560 million Australian fresh juice and functional beverage market, and this has been reflected in the outstanding revenue growth achieved across that period.
Key factors contributing to the growth were the ongoing consumer demand for Original Black Label brand that has benefited from its successful repositioning, excellent quality of the fruit received from key growers and highly effective promotional programs with the major retailers.
FOD has also benefitted from the positive consumer response to the group’s Juice Lab wellness shots being distributed by Coles, and management highlighted that they would be sold from a further 1000 stores by the end of May.
Close relationships with retailers and growers provide predictability
Importantly for a smaller company, top line growth is being converted into earnings growth, and on this note managing director Tony Rowlinson said, “I am exceptionally pleased as to the ongoing positive trend regarding FOD market share gains and growth.
‘’In the past 12 months, the Original Juice Co Brand has grown in excess of 20%.
‘’Considering the challenges we faced regarding the impact of COVID-19 and short supply of fruit, this is an excellent result.
‘’With the roll out of the OBL Brand into the independent retailers in South Australia, the favourable consumer response of the Juice Lab wellness shots into Coles and roll out into a further 1,000 stores by end of May, this has given the business good momentum and it is well positioned for ongoing profitable growth.
One of FOD’s strengths is its strong relationships with the growers who despite sometimes challenging conditions ensure that supply is maintained.
Likewise, management has been able to negotiate robust commercial relationships with the major supermarket chains, as well as other distributors.
General Information Only
This material has been prepared by Jason Price. Jason Price is an authorised representative (AR 000296877) of 62 Consulting Pty Limited (ABN 88 664 809 303) (AFSL 548573) (62C), and a Director of S3 Consortium Pty Ltd (trading as StocksDigital).
This material is general advice only and is not an offer for the purchase or sale of any financial product or service. The material is not intended to provide you with personal financial or tax advice and does not take into account your personal objectives, financial situation or needs. Although we believe that the material is correct, no warranty of accuracy, reliability or completeness is given, except for liability under statute which cannot be excluded. Please note that past performance may not be indicative of future performance and that no guarantee of performance, the return of capital or a particular rate of return is given by 62C, Jason Price, StocksDigital, any of their related body corporates or any other person. To the maximum extent possible, 62C, Jason Price, StocksDigital, their related body corporates or any other person do not accept any liability for any statement in this material.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
