Organto Foods Inc., an integrated provider of organic and value-added organic fruits and vegetables today announced financial results for the three month and six month periods ended June 30, 2021 and also reaffirmed its 2021 annual revenue guidance. All amounts are expressed in Canadian dollars and in accordance with International Financial Reporting Standards (IFRS), except where specifically noted.
Second Quarter 2021 Operating Results:
• Record second quarter revenues of $5,372,162 versus revenues of $2,163,955 in the prior year, an increase of approximately 148% versus the same quarter in the prior year. Second quarter revenues represent the largest quarterly revenues in the history of Organto and the eighth consecutive quarter of record revenue growth versus the same quarter in the prior year. While volumes continued to expand as expected, revenues in the quarter were impacted by a combination of lower avocado selling prices versus expectations due to increased supply from an earlier than anticipated start to the Peruvian export season, and logistics challenges resulting from the timing and availability of containers required to deliver supplies to Europe.
• Record gross profit of $648,987 or 12.1% of revenues versus $232,504 or 10.7% of revenues in the prior year, an increase of approximately 179%. The gross profit in the second quarter of 2021 represents the largest quarterly gross profit in the Company’s history and an increase of 250 basis points versus the previous quarter, driven by a higher mix of value-added private label and branded products.
• Cash overhead costs for the quarter were 26.3 % of revenues versus 26.8% in the prior year. These costs include expenditures of approximately $436,900 related to retail branded product development and on-line digital transformation activities, acquisition related costs and costs related to the successful filing of the Company’s base shelf prospectus, all of which are expected to generate positive future benefits. Excluding these investments, cash overhead costs reduced to 18.2% of revenues in the second quarter.
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