• 🍪 Ferrero Acquires Nonni’s Bakery
• 📥 EIDL Loans and The SBA 
• 🧑‍⚖ Kroger Receives FTC Case Extension
• 🔦 Flashfood Goes Indie
• 🎋 BranchOut Takes in Cash
• 🌱 PepsiCo's ‘Planting Pathways’ Ag Initiative

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Oatly saw volumes grow in all segments during Q2 and credited its shift to an asset-light supply chain model as the primary driver, enabling the brand to reduce its cost structure and focus on more efficient execution, per an earnings report this morning. 

Revenue increased 3.2% year-over-year to $202.2 million in the quarter ended June 30. Volume growth (up 8.3%) in North America helped drive revenue in the segment up 9.7% (or $6 million) – more than half of which came from retail.

To drive further U.S. retail growth, the company appointed CPG veteran Christopher Link to the post of chief customer officer and EVP of retail last month. This is a new role for the company, and Link – who previously held positions at BlueTriton Brands and Nestlé Waters – will be responsible for the oversight and collaboration with U.S. retail customers to support the growth of the brand’s dairy alternatives. 

“These segment Q2 results are a direct result of discipline execution throughout the entire organization and staying true to our North Star of profitable growth,” CEO Jean-Christophe told investors during today’s call, adding that the North America segment saw its first full quarter of positive adjusted EBITDA. 

Supply chain efficiencies are driving real margin gains, Flatin stated. Gross profit margin was 29.2% in the second quarter, an increase of 1,000 basis points compared to the prior-year period, with gross profit up to $59 million ($37.7 million in Q2 2023). 

Marketing Milk: The alt-dairy company also continues to employ off-the-wall marketing tactics, last month crashing the International Dairy Food Association’s Capitol Hill Ice Cream Party with a “Dairy Deprogramming” truck that served plant-based, “propaganda-free” soft serve. 

According to Oatly, the stunt gave the brand a national stage to expose a number of “dark truths” Big Dairy loves to hide, including the fact that 144 gallons of water are used to produce just one gallon of cow’s milk in the U.S. 

What’s Next? The strong Q2 results pushed the alt-dairy company to upgrade its full-year constant currency revenue growth (now 6% to 10% versus 5% to 10%) and adjusted EBITDA (now: a loss of $35 million to $50 million) 2024 outlook while lowering its guidance for capital expenditures to below $70 million, versus the prior expectation of below $75 million. 

“In the second half of the year, our priorities will be completing our work on calibration of resources, investing in high-return demand generating investments, and maintaining our north star target to drive the business toward structural, consistent profitable growth,” said Flatin. 

Go Deeper: Oatly: Supply Chain Strategy Shift Paying Off In Margins

Ferrero-related Belgian holding company CTH Invest has entered a definitive agreement to acquire premium cookie maker Nonni’s Bakery from private equity firm Vestar Capital Partners. Financial terms were not disclosed.

🏭 Founded in 1988, Nonni’s brands include Nonni’s Biscotti, Nonni’s Bites, Nonni’s Snackers, Nonni’s THINaddictives and La Dolce Vita. The Wexford, Pa., company operates four manufacturing plants and employs 350 people.

📈 The transaction is expected to close in the coming months and will strengthen Ferrero’s presence in North America. CTH Invest also owns Michel et Augustin, Burton’s Biscuit Company, Fox’s Biscuits, Kelsen Group and Delacre Biscuits.

During the COVID-19 pandemic the Small Business Administration (SBA) opened up its Economic Injury Disaster Loan (EIDL) program to support businesses through those unprecedented and uncertain times. 

Now, the SBA is beginning to collect on those loans, and some small business owners have found themselves in a precarious financial position, unable to raise outside capital or sell their businesses due to the complexity of the loan terms.

Did your business receive funds from the EIDL program? If so, we’d love to hear from you. Please reach out to adeluca@bevnet.com. 

The judge overseeing the FTC’s case against Kroger and Albertsons’ proposed merger has given all parties a two-day extension on two filing deadlines after Friday’s worldwide Microsoft outage left several counsel laptops “completely unusable.” 

👀 On Monday, chief administrative law judge D. Michael Chappel said the outages were “good cause” to push back deadlines for a pair of pretrial findings, as reported by Law360. 

🗓️ The FTC has until today to file its pretrial brief, while Kroger and Albertsons have until July 31 to respond. 

⏪ The update comes after the two grocery chains were “granted in part” a request to delay the FTC’s case, putting the case on pause until after a hearing for a preliminary injunction against the deal in Oregon federal court wraps on September 13. 

⏸️ Meanwhile, negotiations between Kroger and Colorado regulators appear to have stalled as the grocery stores try to avoid an injunction hearing in the state’s challenge against the mega-merger; the grocers have begun to pitch a state judge on other options to avoid the proceeding. 

Discount grocery tech platform Flashfood is taking its food waste reduction movement to independent grocery stores through a new platform that aims to enable grocers to easily onboard and “attract new customers, boost profits and provide access to affordable fresh food in their communities.” 

♻️ Flashfood is available already in more than 2,200 stores across North America and claims that participating grocers see an average 27% shrink reduction, one or more additional store trips per month and $20 in incremental sales per month.

📍 The initiative is already live in 10 stores across North America including Wyoming, Illinois and Ontario; the company has plans to launch in Earth Fare stores later this summer and aims to onboard more than 100 independent grocers by the end of the year.

🪞 The company has been steadily increasing its footprint in the U.S. this year with retail partnerships in California paired with a rebranded identity and new executive leadership.

Executives from dehydrated produce business BranchOut Food have contributed to a $525,000 investment in the company, with CEO Eric Healy leading the round. This comes in addition to a $3.4 million convertible note from Kaufman Kapital.

🕺 Healy personally invested $400,000 into BranchOut, while Eagle Vision Fund LP – which is affiliated with BranchOut’s CFO – added $100,000, and its president put in $25,000, according to a press release. In exchange, they have received an issuance of 692,529 common stock shares.

🍍 BranchOut produces natural snacks and ingredients made using its exclusively licensed GentleDry dehydration technology, with branded products including Pineapple Chips, Bell Pepper Crisps and Chewy Banana Bites.

🇵🇪 The new financing will be used to complete the construction of a production facility in Peru, which the company said will likely be online in Q4 with approximately $40 million in production capacity.

PepsiCo Foods North America is aiming to add some youthful energy to the agricultural sector via its new Planting Pathways initiative, under its pep+ framework.

🚜 The push includes partnerships with Practical Farmers of Iowa (PFI) and the Farm Foundation, which will support underrepresented and first-time farmers in the ag sector as well as creating career opportunities within PepsiCo Foods North America’s supply chain.

🧑‍🌾 This will include a cohort known as “Field to Future,” in partnership with the Farm Foundation, which is designed to bring new leaders into the space and support the global food system’s growth and innovation at the ground level.