Reuters — Beyond Meat, a U.S. maker of plant-based burgers and sausages, said it expects to more than double its revenue and report breakeven EBITDA this year, sending the its shares up over 21 per cent.
The company said it expects to record revenue of $210 million in 2019 (all figures US$), with break-even earnings, before interest, tax, depreciation and amortization (EBITDA).
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.
The company has captured a wide audience for its imitation meat patties and sausages made from ingredients such as pea protein, coconut and canola oil.
The burgers, a hit with consumers switching to a “flexitarian” diet, feel, smell and taste like real meat.
Beyond Meat’s sales have increased five-fold since it began selling its flagship Beyond Burger in 2016.
“We are very conservative and view this as a floor,” CEO Ethan Brown said on a conference call when asked about the revenue forecast. The company does not count customers who are using its products as a part of a testing project.
“As we are entering into additional test and distribution channels and take on new customers, those will be additive to our numbers,” Brown said.
The company is also working on making its plant-based products cheaper than animal protein to capture more market share.
Beyond Meat, whose rivals include U.S.-based Impossible Foods, is likely to face increasing competition in the niche market as companies such as Nestle and Tyson Foods ready their own lines of products.
“Beyond Meat, right now, does have the first-mover advantage,” said Megan Brantley, vice-president of research at LikeFolio.
The California-based company said its net loss widened to $6.6 million in the three months ended March 30, from $5.7 million a year earlier.
First-quarter net revenue came in at $40.2 million, an increase of 215 per cent, the company said. Analysts had expected revenue of $38.9 million.
“Beyond Meat is in a business that could be absolutely incredible,” John Gillin, an analyst with Stansberry Research, said.
In the Canadian market, Beyond Meat in April announced deals to sell its Beyond Burgers for home grilling through several major grocery retail chains. Fast food chains including A+W and Tim Hortons have also added Beyond Meat products to their menus.
Beyond Meat and its contemporaries have, however, seen some pushback recently from Canada’s meat sector.
Quebec’s Union des producteurs agricoles (UPA) and cattle producer group Producteurs de bovins du Quebec said last month they would approach the Canadian Food Inspection Agency to prohibit the use of the word “meat” in marketing vegetable protein products.
For its part, the Canadian Cattlemen’s Association last month said its view is that “for a product to be labelled or marketed as meat it must meet the legal definition of ‘meat’ or ‘meat byproduct'” as per federal food regulations.
Recent efforts to stop food firms from labelling “vegetarian-based” products as “meat” in Canada is part of an “international movement towards achieving a common nomenclature for meat derived from animal-based proteins,” the CCA said in a statement.
— Reporting for Reuters by Nivedita Balu and Tina Bellon. Includes files from Glacier FarmMedia Network staff.