“Welcome to the new SunOpta,” says Ennen.
Joseph D. Ennen, CEO of SunOpta Inc., informed analysts during the company’s third-quarter conference call to go over financial results that it was the beginning of “a new SunOpta.”
Mr. Ennen stated that the company is now in a position to optimize its product portfolio for growth and profitability, despite having suffered a sizable loss at the end of the third quarter, mainly as a result of the selling of its frozen fruit operations.
Greetings and salutations to the new SunOpta, Mr. Ennen stated in a conference call with analysts on November 8. “We have finished the heavy work surrounding our portfolio transformation with the divestment of the frozen fruit business last month. We started this process in 2020 with the divestment of our global ingredients business, followed by the sunflower business in 2022. We have been investing heavily in our plant-based and snack businesses over the last few years, and the fruits of those investments are now more visible.
“The new SunOpta is a competitively advantaged, highly focused, and growing company that operates in very appealing categories.”
However, SunOpta had to contend with a challenging third quarter before turning the page. In the third quarter that concluded on September 30, the company lost $145.82 million, as opposed to $11.93 million during the same period the previous year. Losses from discontinued operations totaled over $140.14 million in the most recent quarter.
During the quarter, adjusted earnings came to $452,000, down from $2.43 million in the same period last year. From $17.66 million in the same time last year to $19.09 million this year, adjusted EBITDA from continuing operations increased.From $144.02 million to $152.54 million, revenues grew by 5.9%.
According to Mr. Ennen, the increase of oat milk, creamers, teas, and protein shakes were among the third quarter’s highlights. Furthermore, he stated that the company’s fruit snack division continued to have “very strong growth,” with revenues rising 16% to $24 million. This development was mostly attributable to volume increases and private label expansion.However, Mr. Ennen stated that the “new SunOpta” has shown significantly greater promise in terms of performance.
“Pro forma basis, accounting for our Q4 outlook, the new SunOpta has grown EBITDA by 45% and revenue by about 40% over the last 36 months,” he stated. Our EBITDA margins have continuously been between 10% and 12% during this period. This remarkable increase in sales and EBITDA has been attained in a very effective manner.
In addition, the business’s future working capital requirements have been lowered by more than $100 million as a result of the divestment. This revenue and EBITDA growth has been fueled by the capital expenditures we made in 2021 and 2022, and as we continue to optimize these investments, we are pleased about the future growth potential for the new SunOpta.Mr. Ennen noted that SunOpta has a number of strategic priorities going forward, including growth, capital allocation, and operations.
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“Our goal is to maximize the value of the investments we have made to support organic growth by sweating our assets,” he stated. “We think there will be a lot of opportunities to accomplish this over the next years.We are concentrated on proving and generating substantial returns for shareholders now that we have emerged from a significant investment cycle. Since we are a growing business, gaining market share from current clients, attracting new ones, and increasing TAM are our top priorities.