Maggie Beer (ASX:MBH) share price surges on 20% sales growth

The Maggie Beer Holdings Ltd (ASX: MBH) share price is surging today, despite a fall in the ASX 200. Here's the latest on the earnings report

| More on:

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 is surging today, despite a sagging S&P/ASX 200 Index (ASX: XJO). At the time of writing, Maggie Beer shares are up 3.53% to 44 cents a share, contrasting nicely against the ASX 200's 0.9% drop.

The catalyst for today's moves is (of course) the company's earnings report for the first half of the 2021 financial year (1H21).

What did Maggie Beer report this morning?

Maggie Beer holdings has reported that net sales grew by 19.7% in 1H21 to $27.6 million, up from the prior corresponding period (1H20)'s $23.05 million.

That helped push gross profits up to $12.83 million, up 14.5% on 1H20's $11.2 million. It was a different story for net profits after tax (NPAT) though. Maggie Beer reported an NPAT loss of $367,000, still a 97% improvement from 1H20's loss of  $14.3 million (which included a $12.07 million impairment expense).

Earnings before interest, tax, depreciation and amortisation (EBITDA) came in at $1.34 million, up from a loss of $449,000 in 1H20. Meanwhile, Maggie Beer's trading EBITDA metric (which includes leases) turned out at $2.23 million, up 1,378% from $151,000 in 1H20.

Sales were the highlight of Maggie Beer's results. The company reported that Maggie Beer-branded products' net sales increased by 28.6% over the prior period. E-commerce sales of those products grew by 167% to represent 8% of net sales. The Maggie Beer Cheese line was the standout performer of the brand stable, with sales rising 76% over 1H20's numbers. Cooking stocks were up 44%, while fruit paste and pate sales were up 19% and 7% respectively.

The company will be launching a new range of soup products in April this year through the Woolworths Group Ltd (ASX: WOW) grocery stores. The company has also announced it is also planning on expanding its ice cream range in the first quarter of FY2022.

Sales for the company's Paris Creek Farms line were up 11.4%, while St David Dairy sales increased by 5.5%.

Meanwhile, the company's gross margin fell, dropping 2.7% to 46.3%, compared with 1H20"s 48.9%.

Looking forward to 2021 and beyond

Maggie Beer Holdings CEO, Chantale Millard, had this to say on the results, and the future of the company:

We are pleased to confirm to the market our strong result…  however we are cognisant that there is still uncertainty in the economic outlook as JobKeeper winds down in March 21. Despite this uncertainty we remain confident of continuing to deliver double-digit net sales growth… With strong new product development in the pipeline across the Group that we are accelerating for launch, and some exciting plans for our e-commerce and direct to consumer business, we have a busy and exciting second half in front of us.

Judging by the Maggie Beer share price today, investors are in agreement.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Woolworths Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Fancy font saying top ten surrounded by gold leaf set against a dark background of glittering stars.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another shaky day for ASX shares this Tuesday.

Read more »

forklift holding boxes next to upward trending arrow signifying share price lift

If you don't own this ASX stalwart stock, you're missing some serious stability

This stock is riding strong tailwinds, I really like its outlook.

Read more »

ETF spelt out on cube blocks with rising arrows.

Are these record-breaking ASX ETFs now too expensive to buy?

Should you ever buy an ETF at an all-time high?

Read more »

Two parents and two children happily eat pizza in their kitchen as a top broker predicts a 46% upside for the Domino's share price
Consumer Staples & Discretionary Shares

Buy Domino's shares for a 50% return and attractive dividend yield

Morgan Stanley believes investors should be grabbing a slice of this stock.

Read more »

Three guys in shirts and ties give the thumbs down.
Share Fallers

Why Coles, Liontown, Lovisa, and Wildcat shares are dropping today

These ASX shares are having a difficult session. But why?

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Gainers

Why DroneShield, Healius, Newmont, and Paragon Care shares are pushing higher

These ASX shares are having a strong session on Tuesday. But why?

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

Why are ASX lithium shares like Pilbara Minerals crashing on Tuesday?

Lithium stocks are getting another whack today.

Read more »

two colleagues high five each other as they sit side by side at a long desk in front of their laptop computers in an office environment.
Mergers & Acquisitions

Guess which ASX small cap stock is rocketing 27% on 'transformative' merger

Investors are liking the look of this merger plan.

Read more »