Fruit and vegetable processor The Food Revolution Group (ASX: FOD) has updated the market with news the company is currently experiencing heightened demand for its juice and beverage products.
Even more noteworthy is confirmation that its new line of Care Touch hand sanitiser is also in “strong” demand.
Food Revolution chairman Norman Li said the company has “adapted well” to changing market conditions in recent months to increase revenue and diversify its activities into products experiencing a surge in demand.
On the back of its recent performance, the company reaffirmed its full-year revenue guidance of a minimum of $40 million for the current financial year and declared sales are expected to reach a minimum of $22 million in the second half of this year – an increase of 23% compared to the first half of 2020 when sales topped out at almost $18 million.
Concerning its hand sanitiser products, Food Revolution said its sales orders have reached $3.8 million for March alone – a likely indicator of the coronavirus pandemic currently gripping the world with hand sanitiser demand rising exponentially around the world.
According to Food Revolution, it has already commenced hand sanitiser deliveries to retail outlets, including deliveries to major supermarkets starting this month.
Given the strong response from public healthcare agencies and a cultural push to encourage more general hygiene, the company said it expects “further substantial orders” in the next quarter.
Food Revolution commenced production of hand sanitiser just last month after striking a deal with its distribution partner Careline.
Production of a new range of ethanol-based all-purpose disinfectants under the Sanicare brand is planned to start at its Mill Park Factory “within two weeks”, the company announced.
Demand for disinfectant products has increased markedly in parallel to personal hygiene products in the past two months with Food Revolution claiming it can produce disinfectants in “large volumes”.
Market performance was also improved with respect to Food Revolution’s juice products.
Supermarket volumes have risen significantly with the company’s ‘better for you’ juice range benefitting from the pro-health stance currently being adopted by swathes of consumers around the world – potentially as a knee-jerk reaction to the threat of COVID-19 and medical advice about improving nutrition to raise personal immunity.
Moreover, Food Revolution reported it has received interest from a “major supermarket group” to launch three new juice products in May, under its Original Black Label and Original Juice company brands.
“We have big plans for these products through our distribution network in China. As China comes out of the coronavirus pandemic the sale of our new clean factory products is assured,” Mr Li said.
“This is underpinned by the new orders now being received from China distributors for our juice products as well,” he added.
In other news, Food Revolution is set to seek shareholder approval to approve a previously agreed $5.94 million tranche payment from Careline, a company also owned by Food Revolution’s Norman Li.
Due to the emergence of COVID-19 and subsequent shutdowns in China, Careline was unable to transfer funds to Australia to satisfy the pair’s agreement, which also meant 110 million Food Revolution ordinary shares were not issued to Careline.
Before the agreement’s deadline, Food Revolution agreed to an extension with Careline but the ASX intervened by requiring shareholder approval for the extension.
The coronavirus outbreak is now being brought under control in China; the country has not had an increase in new cases since Wednesday this week, while Italy has now overtaken China as the country with the most (currently active) cases.
The number of deaths in Italy now stands at 3,405, which is more than in China where the virus first originated.