Organto Provides Fiscal 2023 Estimates and Operational Outlook

Projects strong revenue and gross profit growth

VANCOUVER, BC and BREDA, NETHERLANDS / ACCESSWIRE / January 30, 2023 / Organto Foods Inc. upstairsOGAUSOGF (“Organto” or “the Company”), a leading provider of organic and non-GMO value-added fruit and vegetable products, today released fiscal 2023 revenue, gross profit and EBITDA estimates and operational updates, as well as preliminary unaudited fourth quarter and full year 2022 revenue and gross profit estimates.

Highlights:

Preliminary Financial and Operating Outlook for Fiscal Year 2023

Expected $CDN revenue growth of approximately 135% over fiscal 2022.
Expected $CDN gross profit dollar growth of ~200% over fiscal 2022.
A positive EBITDA is expected in the second half of 2023.
Full integration of recently acquired The New Fruit Group (see January 3 press release) later in the year.
Expected onboarding of a number of new retail and wholesale customers across Europe.
Expected sales growth of the Company’s flagship brand, I AM Organic, of c.35% over fiscal 2022.
Continuous implementation of digital platform technologies expected to drive significant business opportunities and efficiencies across the enterprise.
Introducing new consumer-friendly brands, including the non-GMO brand = AWESOME Fruits, which launched earlier this month (see January 18 press release).

Preliminary unaudited revenue estimates for the fourth quarter and full year 2022

In the fourth quarter of 2022, revenue increased to approximately $5.5 million, an increase of approximately 12% year over year on a constant currency basis, the largest fourth quarter in the company’s history and the fourteenth consecutive record quarter of revenue growth over the prior-year quarter.
For full year 2022, revenue increased approximately 14% and approximately 23% in constant currency to approximately $22 million compared to 2021, a significant increase from pre-pandemic 2020 revenue of $11.5 million and Fourth consecutive year of record year-over-year sales growth and highest annual sales in company history. Adjusted gross profit⁽¹⁾in percentage terms, sales for the year as a whole were around 7.0%.
The company’s year-end cash balance remained healthy at approximately $5.8 million.

“In 2022, our company achieved revenue growth of approximately 14% before the impact of a lower exchange rate between the euro and the Canadian dollar. Currency-neutral revenue increased approximately 23% Inflation, ongoing supply chain challenges, rapid currency exchange rate fluctuations, the ongoing impact of the global COVID-19 pandemic and the war between Russia and Ukraine, all of which are impacting our customer base, supply chains and costs impact and depth of management played an important role in managing all of this and we were able to achieve record sales, further develop our brands and related technologies and complete the strategic and value-added acquisition of New Fruit Group,” commented Rients van der Wal, Co-CEO of Organto Foods Inc. and CEO of Organto Europe BV.

“As we enter 2023, we have met many of the challenges we faced in 2022 and believe we are well positioned to capitalize on the significant opportunities in the product segments in which we operate,” I AM Organic ” brand and will continue to introduce these products to new retail partners across Europe. We also recently (see January 18, 2020)^th press release) started selling our =AWESOME mid-tier non-GMO fruit brand in German markets. In early January we completed the acquisition of New Fruit Group (see January 3 press release) and have now started selling large volumes of both organic and non-GMO bananas, avocados and mangoes to leading brick-and-mortar retailers in Germany and Denmark. Over the past year we have also made great strides in building our available supply base, strengthening and optimizing our supply chains, building our product portfolio, expanding our customer base and developing the necessary team and processes to support our continued growth into 2023.” , added Rients van der Wal, Co-CEO of Organto Foods Inc. and CEO of Organto Europe BV.

ON BEHALF OF ORGANTO,

Steve Bromley

Chairman and Co-Chief Executive Officer

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For more information about Organto, please contact:

Investor Relations
[email protected]
John Rathwell, Senior Vice President, Corporate Development and Investor Relations
647 629 0018

The information presented here relates to the non-IFRS financial measure of adjusted gross profit. Adjusted gross profit includes realized gains on derivative assets resulting from currency hedging that are directly related to product purchases. This measure is not a recognized measure under IFRS and has no standardized meaning required by IFRS. Non-IFRS financial measures should not be viewed in isolation or as a substitute for analysis of the company’s financial information reported under IFRS and are not likely to be comparable to similar measures of other issuers. Rather, these measures are provided as additional information to supplement these IFRS measures by providing a better understanding of the company’s results of operations from a management perspective and thus highlighting trends in its business that might not otherwise be apparent by looking exclusively based on IFRS key figures. The Company believes that non-IFRS financial measures are frequently used by securities analysts, investors and other interested parties in evaluating the Company. The Company’s management also uses non-IFRS financial measures to facilitate period-to-period comparisons of operating performance and to prepare annual operating budgets and forecasts.

ABOUT ORGANTO

Organto is an integrated provider of branded, private label and distributed organic and non-GMO fruit and vegetable products, using a strategic asset-light business model to serve a growing socially responsible and health-conscious consumer around the world. Organto’s business model is based on its commitment to sustainable business practices that focus on environmental responsibility and a commitment to the communities in which it operates, its employees and its shareholders.

FORWARD LOOKING STATEMENTS

This press release may contain certain forward-looking information and statements as defined by law, including but not limited to the Canadian securities laws and the “safe harbor” provisions of the US Private Securities Litigation Reform Act of 1995 (“forward-looking statements”). In particular, and without limitation, this press release contains forward-looking statements relating to Organto’s business model and markets; Organto’s belief that preliminary 2023 revenue estimates will be 135% year over year higher and preliminary gross profit growth will be approximately 200% year over year higher; Organto’s belief that EBITDA will be positive in H2 2023; Organto’s belief that demand for fresh, organic fruit and vegetable products produced in a sustainable and transparent manner continues to grow and that Organto is well positioned to capitalize on opportunities in these segments; Organto’s belief that the Company has performed well, including achieving record sales, despite significant macroeconomic challenges, including supply chain disruptions, rapid currency fluctuations, the ongoing impact of the COVID-19 pandemic and the Russia-Ukraine War; Organto’s belief that its I AM Organic brand has attracted significant interest from retailers in 2022 and the brand is seeing growth; Organto’s belief that the acquisition of New Fruit Group, completed in 2023, is a positive addition to the Company’s portfolio; Organto believes it has made significant strides over the past year in building its available supply base, strengthening and optimizing its supply chains, building its product portfolio, expanding its customer base and developing the necessary team and processes to support its continuation growth in 2023; management’s beliefs, assumptions and expectations; and general business and economic conditions. Forward-looking statements are based on a number of assumptions, which may prove to be incorrect, including, without limitation, assumptions about the following: the ability and timeframe in which Organto’s business model will be implemented and product offerings increased; cost increases; Dependence on suppliers, partners and contractors; changes in Organto’s business or prospects; unforeseen circumstances; risks associated with the organic products business generally, including inclement weather, unfavorable growing conditions, poor crop yields, variability in crop quality, spoilage, import and export laws and similar risks; transportation costs and risks; general business and economic conditions; and ongoing relationships with vendors, customers, employees, suppliers, consultants, contractors and partners. The foregoing list is not exhaustive and Organto assumes no obligation to update the foregoing except as required by law.

SOURCE: Organto Foods Inc.

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