Organto Foods Inc., an integrated provider of organic and value-added organic fruit and vegetable products today announced its financial results for the three and six month periods ended June 30, 2022. All amounts are expressed in Canadian dollars and in accordance with International Financial Reporting Standards (IFRS), except as noted.
Highlights:
Second Quarter 2022 Operating Results
- Second quarter sales of $5,109,949 versus sales of $5,372,162 in the prior year. Adjusting for the decline in the Euro versus the Canadian dollar, when measured in Euros sales increased by approximately 4% and represents the twelfth consecutive quarter of record sales growth versus the same quarter in the prior year.
- Gross profit of $208,084 or 4.1% of sales versus $648,987 or 12.1% of sales in the prior year. When adjusted for the realized gain on derivative assets of $70,467 which is from currency hedging related to product purchases, adjusted gross profit(1) was $278,551 or 5.5% of sales.
- Cash overhead costs for the quarter were 35.2% of sales, or 27.1% after adjusting for non-recurring and investment spending, versus costs of 26.3% in the prior year. The increase in costs reflects investments in infrastructure and resources to support current and future growth initiatives which are expected to position the Company for future growth.
Year-to-Date 2022 Operating Results
- Six month sales of $12,109,813 versus sales of $10,145,224 in the prior year, an increase of 19.4%. Adjusting for the year over year decline in the Euro versus the Canadian dollar of approximately 10% for the six-month period, sales increased by approximately 29% when measured in Euros.
- Gross profit of $878,668 or 7.3% of sales versus $1,106,802 or 10.9% of sales in the prior year. When adjusted for the realized gain on derivative assets of $82,039 which is from currency hedging and directly impacts the effective cost of products sold, adjusted gross profit was $960,707 or 7.9% of sales.
- Cash overhead costs for the first six months of the year were 29.7% of sales, or 22.6% after adjusting for non-recurring and investment spending, versus costs of 25.3% in the prior year.
"Our second quarter results were directly impacted by an extremely challenging macroeconomic environment including the effects of the Russia/Ukraine war which directly impacted our customer mix and also led to market disruption and short-term supply dislocation, combined with cost increases due to rising inflation, the rapid decline of the Euro versus foreign currencies and continued global supply chain challenges."
"While our results were directly impacted in the quarter, our team acted swiftly to address and mitigate these challenges, and we are confident that we are well positioned for growth as we head into the remainder of 2022 and beyond." commented Steve Bromley, Chair and Co-CEO of Organto.
For more information: organto.com