The Food Revolution Group Ltd (ASX: FOD) is an Australia based company which operates in a food processing business. The company also offers its products to other food producers to meet the needs of the markets. Besides, they also provide packaging and logistics services to third parties, and they also engage themselves in research and development of various food-related technologies to develop multiple products and ingredients.
The Food Revolution Group has secured their order from Careline Australia Private Limited for Fruit Farm Orange Juice and Australia Garden Canola Oil for distribution through China. FOD has a target of achieving at least A$20 million per annum of additional sales within two years. The group is also a major manufacturer and exporter of skincare products, food, supplements and baby formulations into China. Dr. Norman Li, who is the founder of Careline, holds a chairman position in FOD and significant shareholder in the company too.
The company has a significant distribution network in China, Asia; and now domestically with the help of Dr. Norman Li, FOD is motivated to grow its sales to A$100M in the short-term period and A$500M within five years. Careline is anticipating that their sales volume will increase due to product awareness which is building from recent deals with Sinopec for Australian Canola Oil and with JJ Global Fine Foods to supply Fruit Farm Orange Juice products through China.
The Food Revolution Group Limited is planning on signing more deals and growing more sales into China through Careline’s distribution network of 10,000 daigous. The planning is to increase their sales network to 30,000 daigous.
This is a significant occasion for the company as they are moving ahead to distribute their products into China through 10,000-person sales network. They are moving quickly with their growth plans, and for that, they had laid a solid foundation to execute their strategy. They are working to increase their distribution channels and to achieve CIQ (China Inspection and Quarantine) certification for all their products and, once received, they are anticipating that their sales will increase. They are excited to build their brand presence across China and drive revenue growth.
In the last six months, the share price of the company has shown a growth of 310 percent as on 3 December 2018 and 37.50 percent over the past one month. The Food Revolution Group’s shares are trading at $0.155 with a market capitalization of $82.35 million as on 10 December 2018. Despite the latest news, FOD saw its shares plunge by over 6% on December 10, 2018, around market close. The stock trades at a high price to earnings ratio of around 27x. While the stock is on a downtrend, it still sits at a level close to its 52-week high level of around $0.212. Lately, the group updated the market on its first juice supply contract that was executed for China while it has many certificates in place on its footprint enhancement in said geography.
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