Maggie Beer share price surges 23% on Coles agreement

The Maggie Beer share price has soared in early trade after announcing an agreement to launch prepared meals in 400 Coles supermarkets.

| More on:
radishes arranged on a dinner plate to form arrow pointing up

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Maggie Beer Holdings Ltd (ASX: MBH) share price has this morning surged 22.7%. This came following the company's announcement it will be launching a range of plant-based meals in Coles. The launch will increase the company's presence in the $1 billion Australian prepared meals market.

Formerly known as Longtable Group, the company recently changed its name to Maggie Beer Holdings at a general meeting held on 16 July 2020.

Coles agreement

In mid-October this year, Maggie Beer Holdings will launch new incremental ranging of 3 'Maggie's Food for Life' ready to eat meals in approximately 400 Coles supermarkets nationally.  The plant-based meals target the fast growing, prepared and plant-based meals category.

Additionally, the announced launch of the range in a major supermarket is an important step in the company's growth strategy.

Prior to the announcement, Maggie Beer prepared meals had been launched in independent supermarkets in the H1 FY20. 

FY20 preliminary trading update

On 9 July 2020, Maggie Beer provided an unaudited trading update. In the update, the company announced strong sales in May and June this year and advised it is on track to achieve positive earnings before interest, tax, depreciation and amortisation (EBITDA) in FY20. This represents an increase of approximately $5.3 million compared to FY19.

The group's cash position has increased from $5.1 million at the end of December to $7.2 million at the end of FY20. Additionally, it is well funded by $10.2 million in cash reserves and undrawn debt facilities. 

Net sales in FY20 have increased approximately 3.5% compared to the prior corresponding period despite challenging conditions due to summer bushfires and the COVID-19 pandemic. 

Maggie Beer is continuing to work on its eCommerce presence with an an improved digital marketing plan and continued growth generated by the 'Cooking with Maggie' series which, at the time of the update, had over 4.4 million views on social media websites, Facebook and Instagram. Additionally, it will include a new website launch in FY21.

About the Maggie Beer share price

The company's mission is to be a leader in meeting the expectations of discerning consumers with new, high-quality food and beverage experiences. According to Maggie Beer, "This means being at the forefront of mainstream trends, but not side-tracked by fads, recognising that opportunities arise locally & internationally". The Maggie Beer share price is currently trading at 26.5 cents which represents a gain of more than 20% in today's trade. The Maggie Beer share price is up 56% in year to date trading and the company has a market capitalisation of around $52 million.

Motley Fool contributor Matthew Donald has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

Stock market chart in green with a rising arrow symbolising a rising share price.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a massive day for the ASX 200, with a new all-time high recorded.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

This ASX tech stock rocketed 60% in March! Can it keep on delivering?

After soaring in March, the ASX tech stock is now up 169% since this time last year.

Read more »

Broker Notes

Brokers name 3 ASX shares to buy now

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A young man clasps his hand to his head with his eyes closed and a pained expression on his face as he clasps a laptop computer in front of him, seemingly learning of bad news or a poor investment.
Share Fallers

Why Burgundy Diamond Mines, Clarity Pharmaceuticals, EML, and Zip are sinking today

These ASX shares are ending the week in the red. But why?

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping

These ASX shares are ending the week strongly. But why?

Read more »

a young boy dressed up in a business suit and tie has a cute grin and holds two fingers up.
Opinions

2 of my top ASX 200 shares to consider buying before April

I would happily exchange dollars for these two shares right now.

Read more »

Father in the ocean with his daughters, symbolising passive income.
Dividend Investing

I'd spend $8k on these ASX 200 shares today to target a $6,102 annual passive income

I believe these ASX 200 shares will continue rewarding passive income investors for years to come.

Read more »

Three businesspeople leap high with the CBD in the background.
Share Market News

Boom! ASX 200 blasts to new record highs

ASX 200 investors just sent the benchmark index into uncharted territory.

Read more »