Organ Foods Inc., an integrated supplier of value-added organic and organic fruits and vegetables, today announced its financial results for the three-month and six-month periods ended June 30, 2021 and also reaffirmed its annual revenue guidance for 2021. All amounts are expressed in Canadian dollars and in accordance with International Financial Reporting Standards (IFRS), unless otherwise indicated.
Second quarter 2021 operating results:
• Record second quarter revenues of $ 5,372,162 compared to revenues of $ 2,163,955 the previous year, an increase of approximately 148% from the same quarter last year. Second quarter revenues represent the largest quarterly revenues in Organto’s history and the eighth consecutive quarter of record revenue growth compared to the same quarter a year earlier. As volumes continued to increase as expected, revenue for the quarter was impacted by a combination of lower than expected avocado selling prices due to increased supply from an earlier than expected start of the season. Peruvian exportation, and logistical problems resulting from the timing and availability of containers needed to supply Europe.
• Record gross profit of $ 648,987 or 12.1% of revenue compared to $ 232,504 or 10.7% of revenue the previous year, an increase of approximately 179%. The second quarter 2021 gross margin represents the highest quarterly gross margin in the history of the Company and an increase of 250 basis points from the previous quarter, thanks to a higher mix of private label and branded products value-added.
• Overhead expenses paid for the quarter amounted to 26.3% of revenues compared to 26.8% the previous year. These costs include expenses of approximately $ 436,900 related to the development of retail branded products and online digital transformation activities, costs related to the acquisition and costs related to the successful filing of the base shelf prospectus of the Company, all of which are expected to generate positive future benefits. Excluding these investments, general expenses paid were reduced to 18.2% of revenues in the second quarter.
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