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- Keytone Dairy (KTD) has released its December quarterly where it continued to achieve record financial milestones
- It ended the quarter in a near break-even cash position, reducing cash burn 88 per cent to $90,000 from the $735,000 in the prior quarter
- Furthermore, sales grew 36 per cent over the previous quarter to more than $1.4 million thanks to increasing demand across multiple markets
- Distribution of the Tonik Pro and Tonik Plant drinks continued expansion throughout the quarter with the products now available in over 400 Coles stores and 625 fuel outlets
- Additionally, Keytone signed two private label tenders with Foodstuffs and Coles, totalling more than $11 million
- Keytone is steady on the market and shares are trading at 24 cents
Keytone Dairy (KTD) has released its December quarterly where it continued to achieve record financial milestones.
It ended Q3 in a near break-even cash position, reducing cash burn 88 per cent to $90,000 from $735,000 in Q2 FY21 and $4.3 million in Q1 FY21.
The majority of the funds went to manufacturing, operating and staff costs.
Further, sales grew 36 per cent over Q2 to FY21 to more than $1.4 million thanks to increasing demand across multiple markets.
This is a result of the launch of the Tonik Plant and Tonik Pro drinks in Coles stores throughout November. Keytone expects sales for these products to increase as new markets are added.
The company’s New Zealand sales were up 329 per cent from $800,000 in the prior corresponding period to $2.7 million in Q3.
As of December 31, Keytone had $7.7 million in available cash.
Product expansion
Distribution of Tonik Pro and Tonik Plant continued expansion throughout the quarter with the products now available in over 400 Coles stores.
Tonik Pro is also available in petrol and convenience stores, specifically, 250 Caltex outlets, 320 United Petroleum stores, and 55 Freedom Fuel outlets.
Keytone also secured sales of Tonik Plant throughout Village Grocer stores in Malaysia and all stores in Kuala Lumpur.
The company will now focus on expanding sales to the South-East Asian region, China, and the Middle East.
Gym market
Additionally, Keytone has partnered with Brackenbury Nutrition and Nutrition Systems to enter the gym market. Follow-on orders are continuing which are growing in volume and frequency.
These distributors represent the Anytime Fitness and Snap Fitness gyms.
Baileys
Throughout the quarter, Baileys non-alcoholic coffee flavoured milk was ranged nationally in BWS stores.
Discussions are continuing and Keytone expects further products will be launched over the next 12 months.
These products are manufactured and distributed under Keytone’s licensing agreement with Baileys.
Private label clients
Foodstuffs
In early November, Keytone signed a milk powders manufacturing and supply agreement with New Zealand grocer Foodstuffs.
Under this agreement, Keytone will produce and supply whole and skim milk powder for Foodstuffs which will be distributed across the country.
This agreement runs for an initial two-year term and is estimated to be worth NZ$7.1 million (around A$6.64 million).
Coles
A month later, Keytone was awarded a significant Coles Private Label Tender by Coles Supermarkets (COL).
Sales are expected to total $5.2 million per year with the products to be manufactured at Keytone’s Melbourne facilities.
“This third quarter has been another highly successful quarter and one of significant progress and development on multiple fronts,” CEO Danny Rotman commented.
“While headline sales growth eased moderately on a consolidated basis, proprietary brands continued to grow at an impressive rate, and growth in the consolidated business is multiples ahead compared with the third quarter of the prior financial year,” he said.
“As we begin calendar year 2021, Keytone has an exciting strategic agenda and is incredibly well positioned to capitalise upon the momentum and growth the company has achieved over the last 12 months,” he added.
Keytone is steady on the market and shares are trading at 24 cents at 12:47 pm AEDT.
