The Youfoodz Holdings Ltd (ASX: YFZ) share price has been a positive performer on Monday morning.
In early trade, the readymade meals company’s shares are up 2.5% to $1.02.
Despite this, the Youfoodz share price is still down 32% from its December IPO price of $1.50.
Why is the Youfoodz share price pushing higher today?
Investors have been buying the company’s shares this morning following the release of its second quarter update.
According to the release, Youfoodz has reported strong growth and performance across its key operating metrics during the quarter.
For the three months ended 25 December, Youfoodz prepared over 4.8 million meals across both its B2C and B2B channels. This was up 28% on the prior corresponding period.
The key driver of its growth was the B2C channel, which reported a 45.8% increase in home deliveries to 339,893. This was underpinned by a 49.8% increase in active B2C customers to 125,112.
Supporting this growth was the B2B channel, which reported a 30.2% increase in physical stores to 3,406. Managements notes that revenues in this channel will soon be boosted by the recent addition of a large wholesale customer.
All in all, this led to the company reporting a 26.8% increase in gross revenue to $50.6 million for the quarter and a 16.5% lift in half year gross revenue to $100 million.
Despite the strong jump in revenue, Youfoodz wasn’t profitable during the quarter and recorded an operating cash outflow of $0.9 million. However, it has a very strong balance sheet, ending the quarter with cash of $39 million.
Management notes that the company has delivered significant revenue growth in the first half compared to the prior corresponding period. Pleasingly, based on its performance so far in the second half, it believes this momentum is continuing and that it is well positioned to deliver on its IPO objectives.
In light of this, Youfoodz remains confident of achieving its FY 2021 prospectus forecasts. This will mean a 17.8% increase in revenue to $149.9 million and an improved net loss of $0.6 million.
Youfoodz CEO, Lance Giles, commented, “In this first quarterly update since our IPO, Youfoodz is very pleased to report continued strong growth for the business. These results, including record growth in certain key areas, is even more pleasing given the quarter included the Youfoodz IPO and ongoing uncertainty associated with the COVID-19 pandemic.”
“The remainder of FY2021 will be a busy time for Youfoodz as we continue to deliver on our IPO objectives for the business, including continued development of the subscription offering to further improve retention, the launch of new products as part of strategy to broaden menu choice, the launch of the airline frequent flyer partnership and achieving significant milestones towards delivery of Youfoodz’ new facility,” he added.
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