Vegan Food And Drink Manufacturer Oatly Records Increase In Quarterly Revenue
Swedish vegan food and drink product manufacturer Oatly Group has recorded an increase in quarterly revenue and forecast at least a 64% surge in its annual revenue as the newly public Swedish company benefits from rising demand for vegan milk alternatives at restaurants and coffee chains such as Starbucks Corp.
US-listed shares of the company rose 6.5%, trading approximately $1 above its May initial public offering (IPO) price of $17 as it also floated plans to ramp up production to meet "100%" of oatmilk demand by fall.
Founded in 1990, Oatly has ridden a wave of interest in plant-based food in recent years, led by millennials and Gen Z consumers, who are more than willing to spend on sustainable products that are also healthy.
Like plant-based food company Beyond Meat Inc, Oatly said sales of its dairy-alternative products at restaurants rose in the second quarter, recovering from last year's pandemic-driven fall as consumers started to dine out again.
Oatly, whose backers included celebrities Oprah Winfrey and Jay Z, said it was especially benefiting from its exclusive US oatmilk supply agreement with Starbucks Corp, with the coffee chain accounting for 27% of sales in the second quarter.
The Malmö, Sweden-based maker of dairy alternatives said that it expects annual revenue to rise to at least $690 million, above estimates of $681.4 million.
"I don't think anybody expected this magnitude of success at Starbucks. But it's really important for us," Oatly CEO Toni Petersson said on an analyst call.
To catch up with the demand, Oatly spent heavily to ramp up production capacity and on Monday August 16 floated plans to boost capacity at its Utah manufacturing facility by 50%.
Oatly recorded a 53.3% increase in quarterly revenue.
The company recorded revenue of $146.2 million for the second quarter that ended on June 30.
Oatly's expansion as well as higher shipping expenses led to its second-quarter losses widening to $59.1 million from $4.8 million a year earlier.
Excluding items, Oatly lost nine cents per share, compared with estimates of a loss of 10 cents, according to Refinitiv IBES data.