BranchOut Food Inc. Secures Third EnWave Dehydration Machine; Announces $40M Production Capacity with New Peru Facility

Rhea-AI Summary

BranchOut Food (NASDAQ: BOF), a food tech firm specializing in dehydrated products, has secured a third EnWave dehydration machine for its new Peru facility. This addition is expected to enhance production capacity to $40M with 40-50% gross margins. The new 100kW NutraRev System will improve throughput and margins, especially for B-to-B ingredients. BranchOut also has significant orders, including $8M from the largest retailer and $1.1M from the largest warehouse club. The Peru facility's strategic location offers fresh produce and low-cost labor, boosting BranchOut's competitive edge. CEO Eric Healy emphasized the expansion's role in scaling operations and capturing market share.

Positive

• Secured third EnWave dehydration machine to enhance production.
• New facility in Peru expected to achieve $40M production capacity.
• Estimated gross margins of 40-50%.
• 100kW NutraRev System designed to improve throughput and margins.
• Significant orders: $8M from the largest retailer, $1.1M from the largest warehouse club.
• Peru's strategic location offers an abundance of fresh produce and low-cost labor.
• Expansion strengthens competitive edge and market position.
• CEO emphasizes growth strategy and operational scaling.

Negative

• High capital expenditure associated with purchasing new machinery.
• Dependent on the successful launch and operation of the new facility.
• Reliance on significant orders that may not materialize as expected.
• Potential operational risks in the new facility in Peru.

Insights

Financial Analyst

The expansion of BranchOut Food Inc.'s (NASDAQ: BOF) production capacity with the addition of a third EnWave dehydration machine and facility in Peru is noteworthy. This move is expected to scale their operations significantly, boosting their production capacity to $40M with estimated gross margins of 40-50%. These figures are important as they suggest a substantial potential increase in revenue and profitability.

The strategic location in Peru provides several advantages, such as access to abundant fresh produce and lower labor costs, which could enhance BranchOut's overall cost efficiency. The company's ability to secure large orders, including $8M from the nation's largest retailer and $1.1M from the largest warehouse club, underlines strong demand and market interest in their products.

Investors should note that the introduction of the NutraRev System is expected to improve throughput and margins, especially in the B-to-B ingredient sector. This diversified product capability can potentially open new revenue streams and customer bases. However, it's important to monitor the execution risks associated with ramping up new production facilities and integrating new technologies.

Market Research Analyst

The implementation of the NutraRev System in BranchOut's production process highlights the company's focus on technological innovation. The system is designed to enhance throughput and improve margins, which could be important for meeting the increasing market demand effectively. By expanding their facility in Peru, BranchOut not only capitalizes on the location's agricultural abundance but also leverages cost benefits associated with low labor costs.

This expanded capacity could solidify BranchOut's position in the competitive landscape, particularly within the dehydrated fruit and vegetable products sector. The significant orders from major retailers indicate a robust market presence and demand for their products. However, it is essential to consider potential challenges in maintaining product quality and consistency as they scale up operations.

Moreover, the strategic move to enhance their B-to-B ingredient capabilities might diversify their revenue streams, reducing dependency on any single market segment. This diversification could be beneficial for long-term stability and growth.

BEND, Ore., May 24, 2024 (GLOBE NEWSWIRE) -- BranchOut Food Inc. (NASDAQ: BOF), a leading food technology company specializing in dehydrated fruit and vegetable-based products, today announced the expansion of its agreement with EnWave Corporation (TSX-V: ENW | FSE: E4U). As part of this enhanced partnership, BranchOut has purchased its third large-scale EnWave dehydration machine. This addition is strategically aimed at expanding its new facility in Peru, with operations anticipated to commence in Q3, ultimately completing an estimated $40M in production capacity with 40-50% estimated gross margins.

The newly acquired 100kW NutraRev System, distinct from the two QuantaREV systems previously purchased, is designed to enhance throughput and improve margins, particularly in the B-to-B ingredient space. BranchOut currently operates a 60kW QuantaREV and has committed to a larger 120kW QuantaREV, both primarily aimed at branded and private label snackproducts. The addition of the NutraRev System is expected to bolster BranchOut's capabilities across different product lines.

These machines will be instrumental in servicing BranchOut's significant orders, including approximately $8M from the nation’s largest retailer, $1.1M from the nation’s largest warehouse club, and other potential customers in the pipeline. This expansion will position BranchOut as one of the largest Radiant Energy Vacuum (REV™) installations globally and the largest in Latin America. The strategic location in Peru, with its abundance of fresh produce and low-cost labor, further enhances BranchOut's competitive edge.

Eric Healy, CEO of BranchOut Food Inc., commented, "This expansion is a key element of our growth strategy, enabling us to scale our operations and capture additional market share. By integrating the NutraRev System into our lineup, we are not only poised to meet increasing demand but also to enhance our operational efficiency significantly. This positions us to lead in the production of high-quality ingredients and snacks, reflecting our unwavering commitment to innovation and excellence in the food industry."

About BranchOut Food Inc.

BranchOut Food is an international food-tech company delivering truly great natural snacks and real superfood ingredients enabled by its licensed dehydration technology. The company’s GentleDry Technology is the next generation in dehydration technology, preserving up to 95% of the original nutrition of fresh fruits and vegetables. BranchOut’s technology is protected by more than 17 patents. BranchOut Food is proud to be a leading provider of high-quality dehydrated fruit and vegetable-based products and its commitment to quality and innovation sets it apart as a trusted brand and private label supplier. For more information about BranchOut Food Inc. and its products, please visit www.branchoutfood.com and follow us on LinkedIn and Instagram.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts of future events. Forward-looking statements may be identified using words such as "forecast," "intend," "seek," "target," "anticipate," "believe," "expect," "estimate", "plan," "outlook," and "project" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements with respect to the operations of BranchOut Food, Inc., (the Company) strategies, prospects and other aspects of the business of the Company are based on current expectations that are subject to known and unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from expectations expressed or implied by such forward-looking statements. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Although it may voluntarily do so from time to time, the Company undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

For more information
Jeff Ramson
PCG Advisory
646-863-6893
jramson@pcgadvisory.com

FAQ

What recent equipment acquisition did BranchOut Food Inc. announce?

BranchOut Food Inc. announced the acquisition of its third EnWave dehydration machine.

What is the estimated production capacity of BranchOut's new facility in Peru?

The new facility in Peru is expected to achieve a production capacity of $40M.

What are the estimated gross margins for BranchOut's new facility?

The estimated gross margins for the new facility are 40-50%.

Which new system did BranchOut acquire to improve throughput and margins?

BranchOut acquired the 100kW NutraRev System to improve throughput and margins.

What significant orders has BranchOut secured recently?

BranchOut has secured an $8M order from the largest retailer and a $1.1M order from the largest warehouse club.

Why is the location of the new facility in Peru strategic for BranchOut?

The Peru location offers an abundance of fresh produce and low-cost labor, enhancing BranchOut's competitive edge.

How does the new facility in Peru impact BranchOut's market position?

The new facility strengthens BranchOut's competitive edge and positions it as one of the largest Radiant Energy Vacuum installations globally.

What did CEO Eric Healy say about the new facility in Peru?

CEO Eric Healy said the expansion is a key element of BranchOut's growth strategy, enabling them to scale operations and capture additional market share.