Food & Ag: It looks like the sun is finally starting to shine for Murray River Organics
Food & Agriculture
Food & Agriculture
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Long-suffering shareholders in Murray River Organics (ASX:MRG), which has experienced near-constant upheaval amid consistent bad news in its three years on the ASX, could be forgiven for being a little skeptical.
But its latest announcement — coupled with its FY19 results that showed an 80 per cent decrease in full-year loss — suggests the sun might finally be coming out from behind the dark clouds.
The health food maker says it has increased exports of its products by 27 per cent year-on-year, and that sent shares up 10 per cent to 7.5c.
Valentina Tripp, who was appointed as the company’s CEO 18 months ago in an effort to turn its fortunes around, said China has been MRG’s biggest benefactor.
“China has been a major contributor to the increase, with sales to Chinese customers more than doubling in FY2020 since the same time last year, as MRG leverages the increasing demand in China for healthy foods,” she said, adding that the company’s launch on the Chinese social media platform WeChat had been successful.
“It enables us to communicate directly with Chinese consumers, build brand awareness and share our story. With ongoing concerns about food safety in Asia we believe Australia’s trusted clean and green reputation is also helping us to win new contracts.”
The increase in exports follows an 80 per cent improvement in the company’s bottom line in FY19, narrowing its full-year loss from $60m to $12m, although revenue fell by 12 per cent year-on-year.
“We now have the business model, the capability and the demand for organics to accelerate our growth. Size does matter and through our scale and reach, we will continue to bring organics and ‘better-for-you’ food to mainstream consumers,” Tripp said on release of the FY19 results.
“Whilst we have faced some significant challenges, with the support of our shareholders, our bankers, customers we have achieved a re-set of the business,” added Murray River chairman Andrew Monk.
Stockhead has contacted MRG for comment.
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