SunOpta posted $229.7m in income for the third quarter ended Oct. 1, 2022, a 15.7% improve in contrast the Q3 2021 pushed by 19.9% development within the firm’s plant-based phase led by the expansion of oatmilk.
The corporate, which manufactures personal label, identify manufacturers, and its personal manufacturers (SOWN and Dream), noticed the quickest development amongst its own-branded plant-based milks enterprise with revenues up 41% vs. one yr in the past and quantity features of 33%.
“We proceed to see very robust top-line development. The buyer continues to spend cash within the class,” SunOpta CEO Joe Ennen instructed FoodNavigator-USA.
Ennen stated that regardless of no matter financial or monetary pressure customers are feeling, plant-based milks are one space they’d be hard-pressed to surrender.
“The rationale for that’s there are very robust underlying bedrock client drivers of plant-based milk that supersede no matter’s occurring within the economic system. So when the economic system’s tight you might forego a Hawaii trip or a brand new automotive or reworking your kitchen, however most individuals are loath to commerce out merchandise they assume are contributing to their well being,” he famous, mentioning that many customers who grew up consuming plant-based milks merely favor the style over cow’s milk or for the various People who’re lactose illiberal, dairy milk isn’t a sensible dietary choice.
Oatmilk on fireplace
SunOpta, which manufactures a full suite of plant-based milks (i.e. almond, coconut, rice, soy), continues to see its oatmilk enterprise (personal label, identify manufacturers, and personal manufacturers) take off.
“Within the final 13 weeks, we’ve seen the oatmilk phase develop 29%. SunOpta’s oatmilk enterprise grew 68%. We’re rising considerably sooner than the remainder of the manufacturers within the class,” stated Ennen.
“We might attribute to that a number of issues. No. 1 is we’ve an impressive product — as evidenced by the market share and gross sales momentum that we’ve. Second, we’ve finished an amazing job of servicing our prospects and holding them in inventory and we’re being rewarded with gross sales momentum.”
With previous headlines circulating of ‘The Nice Oat Milk Scarcity’ of 2018, Ennen stated SunOpta was vigilant in guaranteeing a secure, safe provide of oat milk from the beginning.
“We had been very proactive in figuring out and bringing on-line a number of sources of oats in order that we had been in a position to sustain with the demand. Second is, we’re nice at operating manufacturing crops,” he stated.
SunOpta presently owns 4 plant-based/aseptic manufacturing services all through the nation together with a 400,000-square-foot mega facility in Midlothian, Texas, coming on-line on the finish of 2022 to help buyer demand in plant-based drinks and plant-based protein drinks, in response to Ennen.
‘We’re seeing a little bit of a resurgence of soy milk’
Whereas extremely centered on the success of its oatmilk enterprise, Ennen highlighted different subsegments of the plant-based milk class which can be gaining steam.
“We’re seeing a little bit of a resurgence of soy milk. We’re seeing it, particularly with youthful customers,” stated Ennen.
“It’s an attention-grabbing one as a result of it’s the most nutritionally full (offering a full amino acid profile) out of any of the plant-based milks, with no shadow of a doubt,” stated Ennen noting how soy milk has suffered greater than its fair-share of unfavorable well being perceptions.
“If you consider the whole lot else that’s soy primarily based, whether or not it’s tofu or edamame, these are all optimistic wholesome merchandise. If you consider each vegan and vegetarian, soy is certainly one of their primary sources of protein.”
Ennen predicts that soymilk will proceed to creep again up in gross sales as extra youthful customers enter the class.
Coconut milk additionally posted robust mid-30% year-over-year development pushed largely by the foodservice channel, particularly espresso outlets which use coconut milk as a base for its seasonal, promotional espresso drinks.
“A number of of the massive firms within the espresso store house report robust foot visitors and gross sales momentum, and there is a optimistic correlation there to our enterprise,” stated Ennen.
Trying on the yr forward, Ennen stated the corporate is nicely on monitor to ship EBITDA of $100m in 2023 by committing to its agnostic strategy to the plant-based milk class.
“When it comes to the place that development will come from, it’s an extension of the present playbook. It’s capability expansions to assist our prospects develop. It’s persevering with to steer with oat milk and proceed to construct out a strong set of choices,” he stated.
“We’re agnostic. We need to proceed to serve the entire class. We see ourselves as a pioneer in plant-based meals and drinks, and that’s how we need to win.”