Investors devour Beyond Meat as sales surge

06/10/2019 03:00 |

Investors devour Beyond Meat as sales surge

Impossible Foods and Nestle - which will launch a Sweet Earth-brand plant-based burger this fall - are others.

In the first quarter of 2019, Beyond Meat's net sales jumped 215% to $40.2 million, driven by increased sales of the Beyond Burger and greater demand from new and existing customers.

Analysts on average forecast full-year sales of $205 million, and a loss, before interest, tax, depreciation and amortization, of $10.28 million, according to Refinitiv IBES data.

Amid a chilly equity market depressed by global political turmoil, a California food startup called Beyond Meat has defied all odds and surged over 300 percent in its first three weeks since going public last month.

The company has captured a wide audience for its imitation meat patties and sausages made from ingredients like pea protein, coconut and canola oil.

They added: "We continue to expect significant growth potential in the plant-based meat category and believe that Beyond Meat is well positioned as one of the front-runners leading the new wave of plant-based meat products".

Sales are growing as people seek to cut down on meat for health and environmental reasons.

Net losses widened during the quarter from Dollars 5.7 Million a year ago to USD 6.6 Million at the end of the first quarter. The space is only getting more crowded, and the sooner Beyond Meat can solidify brand loyalty among shoppers and satisfactory performance for grocers, the stronger position it will have as Nestlé, Impossible Burger and others reach grocery aisles.

"We're being very conservative and viewing this as a floor", said chief executive Ethan Brown.

According to Reuters, grocery stores are split on the issue.

John Beretta, group vice president for meat and seafood merchandising at Albertsons Companies Inc, which owns Safeway Inc, Lucky and Randalls stores, said the meat case will change based on consumer demand, with plant-based items potentially replacing some meat products. McDonald's, meanwhile, has not teamed with a plant-based meat company as of yet.

Brown added that the company is "still in the very early innings of growth" and that it had learned from product shortages in 2017 and 2018. Beyond Meat is now valued at almost $6 billion.

Impossible Foods, which has so far focused on supplying restaurants, plans to sell its Impossible Burger in supermarkets' meat cases by the end of the year.

Brown said the company is in the testing phase with several fast-food chains but did not say which ones.

Some retailers like Natural Grocers place Beyond Meat in an alternative protein section to avoid confusion, while others such as Kings Foods Markets sell the products in the dairy and meat sections.

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