Organto Foods
Inc., an integrated provider of organic and value-added organic fruits and vegetables today announced financial results for the three- and nine-month periods ended September 30, 2021. All amounts are expressed in Canadian dollars and in accordance with International Financial Reporting Standards (IFRS), except where specifically noted.
Highlights:
Third Quarter 2021 Operating Results:
- Record third quarter revenues of $4,298,282 versus revenues of $2,737,081 in the prior year, an increase of approximately 57% versus the same quarter in the prior year. Third quarter revenues represent the largest third quarter revenues in the history of Organto and the nineth consecutive quarter of record revenue growth versus the same quarter in the prior year. Growth in the quarter versus the prior year was driven by increased volumes of avocados, ginger, herbs and asparagus sold to a variety of customers throughout Europe. These record results were achieved despite global logistics challenges caused by container and transportation availability which impacted deliveries from a number of growing regions and an unfavorable foreign exchange impact year over year.
- Record third quarter gross profit of $529,018 or 12.3% of revenues versus $285,951 or 10.4% of revenues in the prior year, an increase of approximately 85%. The gross profit in the third quarter of 2021 represents the largest third quarter gross profit in the Company’s history and largest gross profit as a percentage of revenues in the history of the Company. The increase of 190 basis points versus the previous year was driven by a higher mix of value-added private label and branded products, and was achieved despite global logistics challenges which have driven inflationary cost increases.
- Cash overhead costs for the quarter were 33.6% of revenues, 23.1% of revenues on an adjusted basis, versus 22.7% in the prior year, reflecting investments in infrastructure and resources required to support current and expected growth. Costs in the quarter include expenditures of $453,810 related to retail branded product development and on-line digital transformation activities, acquisition and corporate development costs, all of which are expected to generate positive future benefits.
Third Quarter 2021 Results
Revenues for the three months ended September 30, 2021 were $4,298,282 as compared to $2,737,081 during the same period in the prior year, an increase of 57% and the nineth consecutive quarter of record revenue growth versus the same period in the prior year. Sales of vegetable and fruit products, including fresh organic asparagus, avocado, ginger, fresh cut herbs and others were sold to a variety of customers throughout Europe.
The third quarter is traditionally a seasonally low quarter in European markets due to a combination of increased local supply of fresh fruits and vegetables and the European vacation season, which both have an impact on retail product demand.
While volumes of key products continued to grow, sales were impacted in the quarter by logistics challenges caused by the COVID-19 pandemic which impacted the timing and availability of containers required to deliver products to Europe and a reduced Euro/Canadian dollar exchange rate.
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For more information: www.organto.com