The Maggie Beer Holdings Ltd (ASX: MBH) share price was up as much as 9% today before partially retreating. This comes after the company announced, "strong double-digit growth in FY21" and a new ranging deal with Woolworths Group Ltd (ASX: WOW).
At the time of writing, shares in the food and beverage company are trading for 34.5 cents each – up 4.55%. For comparison, the All Ordinaries Index (ASX: XAO) is currently trading 0.68% lower.
Let's take a closer look at today's announcement.
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Why the Maggie Beer share price is on the move
Business update
In a statement to the ASX, Maggie Beer Holdings said net sales, compared to last year, are up by double digits. Its "core business and e-commerce" platforms are up a combined 29% in April 2021, compared to the year prior.
Easing COVID-19 restrictions in Victoria have seen sales in its Saint David Dairy range "restored to pre-COVID levels". Net sales YTD for the products are up 9% on this time last year. Paris Creek Farms sales are up 5% on the previous year.
Maggie Beer says sales for Paris Creek have been impacted by a "realignment" of its private-label business. The company claims this has resulted in reduced sales but greater profits. As well, the company says the product is being ranged more widely in Victoria and South Australia. Maggie Beer Holdings will now conduct a "strategic review" of Paris Creek to "unlock shareholder value."
Sales in Hampers and Gifts Australia (HGA), which the company acquired in March, are up 96% on April last year. Maggie Beer says it will fully integrate the business into the fold by the end of May.
News of the HGA purchase sent the Maggie Beer share price rocketing 18%.
New product ranging
Also in the statement, Maggie Beer Holdings reported it will "launch [a] new range of Finishing Sauces and Bone Broths in October 2021…" in at least 75% of Woolworths supermarkets. The company hopes the launch of these products will aid in the reduction of seasonal variations in its sales.
Independent stores will also be selling the new products from October.
The new range of products will comprise four different sauces and two bone broths.
Management commentary
Chantale Millard, CEO of Maggie Beer Holdings, said:
We are very pleased with the continued growth in the MBH Group, in particular the strong growth of the Maggie Beer Products business.
It is also great to see Hampers & Gifts Australia continuing to demonstrate excellent growth over FY20, including over the sharp uplift in sales experienced by the e-commerce industry in April 2020 from the Covid-19 pandemic lockdown. With the recent successful completion of the capital raise to purchase HGA and the launch of the two new products lines for Maggie Beer Products later this year, we are expecting our strong growth to continue into FY22 and beyond, as the MBH Group cements its position as the premium food and beverage brand in the entertaining and e-commerce space.
Maggie Beer share price snapshot
Over the last 12 months, the Maggie Beer share price has increased by 163.8%. It is, however, down by around 30% since the beginning of this year.
Given its current valuation, Maggie Beer Holdings has a market capitalisation of approximately $97 million.
