Retail Food Group Provided Clarifications Regarding Product Date Extensions

  • May 06, 2019 AEST
  • Team Kalkine
Retail Food Group Provided Clarifications Regarding Product Date Extensions

Global food and beverage company Retail Food Group Limited (ASX: RFG) has assured that it adhere to strict standards in food quality. In a response provided by the company regarding product date extensions, the company has informed that it grants product date extension only after getting written approval from the supplier. While providing this update, the company also informed that as a voluntary action it is going to withdraw any products which had received approved date extensions from the company’s suppliers.

The company has been working together with its preferred supplier network to make sure that only high quality products are delivered to franchise stores and in the last financial year it worked with over 1,000 Australian suppliers to deliver products through its vast distribution network around Australia.

In the last eighteen months, the company’s brands engaged with less than one percent of its supplier network to request possible shelf life extension and these extensions are related to around 0.25 percent of the company’s annual spend with its supplier network.

The company has been involved in auditing its suppliers and distributors regularly. In today’s announcement, the company has assured that it is going to remove any supplier from its network who has not followed the relevant food safety regulations.

The company is currently exploring various options to reduce its debt, including the potential sale of its Donut King and QSR divisions and recently ended its discussion with a potential buyer with regards to sale of these assets as it believes that the sale of any of these assets must be at a price which is acceptable to the company’s Board but in the best interests of its shareholders.

In the first half of FY19, the company reported Underlying NPAT of $6.6 million as compared to $24.7 million in the previous corresponding period (pcp). Further, the company reported statutory net loss after tax of $111.1 million.

During the half year period, the company took significant restructuring initiatives to improve business performance and reduce cost base which includes targeting around $20m in annualised cost saving and better aligning resources closer to business unit and franchisee/customer needs.

Now, let’s have a glance at the company’s stock performance and the return it has posted over the past few months. The stock is trading at a price of $0.205, down by 8% during the day’s trade with a market capitalisation of ~$38.38 Million as on 6 May 2019. The counter opened the day at $0.220 and touched a day’s low of $0.205 with a daily volume of ~344,498. The stock has provided a year till date return of -28.81% & also posted returns of -43.24%, -30.00% & -8.70% over the past six months, three & one-month period respectively. It had a 52-week high price of $0.960 and touched 52 weeks low of $0.150, with an average volume of ~854,367.


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