Naturally Splendid Enterprises Ltd. (TSX-V:NSP, OTC:NSPDF) has said it will continue to focus on its core plant-based manufacturing business as it looks to eliminate operations that are not contributing to the company’s growth moving forward.
In a statement accompanying the release of its year ended December 31, 2021 results, the company said its senior management is reviewing all operations to draw up a strategic plan that will capitalise on its strong position to continue penetrating the market it described as having “a bright future”.
"The company continues to focus on reducing operating overheads while we continue to re-purpose our existing certified food facility in Pitt Meadows, BC to optimize production of plant-based entrees,” Naturally Splendid CFO George Ragogna said in the statement.
“We have made positive strides for the company in several areas, including securing an exclusive 10-year manufacturing and distribution agreement for Canada with Flexitarian Foods Pty. Ltd, Australia's largest plant-based manufacturer,” he said, noting the agreement can be extended for a further 10 years.
READ: Naturally Splendid Enterprises shows off Plantein plant-based entrees at Planted Expo in Vancouver
The Vancouver-based company’s build-out of its Pitt Meadows facility will allow for the production of up to 20 tons of plant-based entrees daily for the majority of its standard plant-based offerings, and as much as 30 tons of plant-based production daily for certain products, translating to a manufacturing capacity potential of over C$30,000,000 annually, Ragogna said.
The manufacturing facility will remain a cornerstone of the company’s future, driving revenue not only from its own products but also through private label and contract manufacturing clients.
Naturally Splendid initially focused on food service, developing a network of distributors that included national distribution partners such as Sysco Canada, Gordon Food Services, and Tri-Elite Marketing, one of Canada's leading food service brokers, to represent Plantein across Canada.
Plantein is the company’s retail line of plant-based entrees including burgers, crumbed and sweet chili tenders, nuggets, and fillets.
“While we continue to progress with the build-out of our facility, our combination of brokers, distributors and internal sales staff continues to work towards increasing our sales in both food service and retail channels,” Ragogna added.
Naturally Splendid said gross profit margins increased by 3.4 percent in the year ended December 31, 2021, from a year earlier due to higher margins from new plant-based sales.
It noted that however, COVID-19 restricted the launch of more product lines, resulting in lower sales of $763,796 in 2021, compared with $1,576,408 in 2020.
Meanwhile, its net loss in 2021 narrowed to $3,269,452 from $4,659,642 a year ago due to lower selling and distribution expenses, the company added.
"The company recently attended three significant industry trade shows that have been on a hiatus for the past two years due to the pandemic. Being able to sample our delicious entrees in trade show settings has made a huge difference, generating significant interest in our Plantein line of plant-based offerings,” said Naturally Splendid CEO Craig Goodwin.
Among the events the company attended were the Canadian Health Food Association trade show, Western Canada's largest natural, health and organics trade event, and the Planted Expo, Canada's largest plant-based consumer event of the year.
“These shows affirmed our belief that we have a winning product line and we have seen an increase in sales activity from retailers, food service outlets as well as consumers buying directly through the Plantein website,” Goodwin added.
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