ADELAIDE INVESTMENT COMPANY CRACKS THE VIETNAM MARKET
Written on the 8 May 2017 by David Simmons
BESTON Global Food Company (ASX: BFC) has secured a retail distribution deal in Vietnam with its first order for cheese from the country's giant supermarket group MM Mega Market ('MM Mega').
The Adelaide-based company sealed the deal for an undisclosed sum, which includes an agreement for an on-going supply of products to MM Mega.
MM Mega has recently stated they intend to intensify the control of food safety and hygiene, and work with food companies that have safe supply chains.
Chief Executive of BFC, Sean Ebert, says the company is well placed to become a long-term supplier in Vietnam, thanks to its focus on producing clean and premium food and beverage products.
"MM Mega is currently evaluating other BFC food and beverage products which we expect will lead to further purchase orders in due course," says Ebert.
The deal has been drawn out over the last 12 months due to strict import controls in Vietnam.
"Over the past 12 months, BFC has worked through these various approval processes and has established a beach head in Vietnam from which we anticipate that other distribution and product placement arrangements will flow," says Ebert.
BFC predicts that the revenue and profit impact of the MM Mega orders will largely appear in the 2017-18 financial years and beyond, given the timing of the orders.
The BFC share price has been see-sawing in recent months.
In March the Company's announcement of a $22 million supply deal with China-based meat producer Chongqing Hondo Food Company Limited saw BFC's share price skyrocket more than 30 per cent in one day.
In August 2016, the company announced lower than expected sales and earnings and a reduced dividend payment, and its shares plunged 12 per cent as a result.
At 3pm AEST, BFC's shares are up 3.9 per cent to $0.26.
Business News Australia
Author: David Simmons