Freedom Foods Group Limited

FNP Details

Initiating Expansion Strategies - Freedom Foods Group Limited is engaged in sourcing, manufacturing, sale, marketing and distribution of cereal and snacks; sourcing, manufacturing, selling, marketing and distributing plant and dairy based beverages; selling, marketing and distributing canned seafood, and investment in dairy farming operations. The Group announced new launches within its expanding Nutritionals Business platform and it will launch in July 2018 a new range of Early Stage Nutrition products in Australia and within its existing distribution base in SE Asia. It is worth noting that Australia’s Own Diamond pro+ Premium Infant Formula, Follow-On Formula and Toddler Milk Drink have been formulated based on the very latest nutritional and scientific evidence within early stage nutrition and the range includes a unique combination of both probiotics and prebiotics.

The Group is working with AO China Company to formulate launch plans for China over the next 12 months and the Company intends to manufacture its Own Diamond pro+ Premium range within a planned blending and packing facility at the Shepparton site once completed in 2019. The Company informed that it continues to experience strong demand across its business activities in Australia, China and SE Asia and the demand is of dairy, plant-based beverage, cereal and snacks which reflects the positive impacts on the Company of structural change within the Australian dairy industry. The demand from customers for the Company’s expanded operational footprint and the increasing brand penetration led to the increased market share in key channels and categories in Australia, SE Asia and China.


Gross-sales by Geography and Key-category (Source: Company Reports)

The Company announced that it expects net sales for FY 2018 to be approximately $353 million, an increase of $91 million or 35 per cent on the prior financial year (based on a preliminary unaudited review). Initially, the group expected its full year sales to be within a range of $360-$380 million. The market was thus disappointed with the update. However, the Company expects that net sales revenue in FY 2019 will be in the range of $500 to $530 million. Percentage of Debt in Total Capital Employed increased from 4.6 per cent in June 2017 to 25.6 per cent in December 2017.
The stock price was climbing high since it got listed on ASX and was up by 42.13 per cent in one year as on 11 July 2018. The stock slipped by 7.33 per cent and closed at $5.94 as on 12 July 2018 and It is trading near its 52-week high price that is $6.80. The stock can be avoided for now at the current price of $ 5.940, and one can look for the impact of its expansion strategies in the market.

 
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