A $145m finance package, a canny insider buy, record results and a possible April Fool’s…

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

Turns out six is no more a magic number in FFF’s listed FoodTech space than any other – after two consecutive weeks in which share price risers increased by six, last week’s Food on the Move asked the question: “Can listed FoodTech make it three sixes in a row next week and in the process keep up the sequence?”  This week’s Food on the Move reveals the answer: no, although with 24 risers, 21 fallers and four non-movers, the week ended 31 March 2023 did see the number of share price risers surpass that of fallers for the first time in six weeks…maybe six is a magic number after all.

Another week, another eye-catching move in the share price of Local Bounti (LOCL) – week ended 17 March, LOCL shares put on 47%; week ended 24 March, shares gave up around the same amount; week ended 31 March?  LOCL shares soar 114% to close at USD0.797, pretty much where they stood two weeks previously.  No mystery regarding the cause of the more than doubling in the share price – the title of the company’s announcement “Local Bounti Secures up to $145 Million of Additional Financing to Support Growth” says it all.

The press release goes on to say that the US indoor agco has “…secured a total of up to $145 million of new financing across two sources – the first through an amendment to its credit facility agreements with Cargill Financial Services International, Inc…and the second, a sale-leaseback deal with an internally managed net-lease real estate investment trust. The combined financing supports Local Bounti's growth plans and immediate efforts to increase production to meet accelerating demand for the Company's products.” LOCL did also announce a full-year net loss of “US$111.1 million in 2022 as compared to net loss of $56.1 million for the prior year period. Adjusted EBITDA1 loss was $29.8 million,” but hey that’s so last year’s news…

Shout out to HelloFresh’s (HFG) Christian Gärtner for seemingly calling the bottom of the meal kit co.’s share price.  On 20 March, the Group CFO acquired €31,107.20 worth of HFG shares at €15.5536 a pop, a level not seen since 2019.  A little over a week later and the shares were trading 41% higher at €21.91 after the share price put on 26% over the course of the week ended 31 March 2023.  One to keep an eye on that Mr Gärtner.

The week’s wooden spoon goes to Verde Agritech (NPK) – shares closed down 40% at CAD3.06 and that was despite the potash fertiliser co. unveiling a record set of full-year numbers: 190% jump in revenues to $80,271,000; 57% increase in sales to 628,000 tonnes; 271% increase in EBITDA before non-cash events to $23,912,000; 405% rise in net profits to $17,804,000.  And yet the shares still shed 40%.

The damage appears to have been done by the guidance dished out by management: “…potash trends did not meet the market's expectations after the Ukraine war, reflecting in decreasing fertilizer prices and lower demand throughout 2022. The price of potash has been on a downward trend since late 2022, with a decrease of 47% in 2022 average KCl CFR Brasil price, compared to the current price, leading farmers to holdback potash purchases with the expectation of even lower prices in the near future.”  Begs the question what the shares would have done had the results not set a new record…    

Finally, good week for Ocado (OCDO)…finally!  Shares jumped 22% to close at 535p.  Spoilt for choice in terms of an explanation: Ocado Retail, the group’s joint venture with Marks & Spencer, got through its Q1 trading statement with full-year guidance still intact - Q1 Retail revenues came in at £584m, up 3.4% vs the same quarter last year; then there was news that the online grocer was claiming ‘total victory’ in its patent tussle with Norwegian rival Autostore after a High Court ruled in its favour.  And that may not be the end of it.  The shares could get a further boost in the week ahead after OCDO was included in the Motley Fool’s list of “Best British shares to buy in April”.  Only trouble is the Motley Fool article was published on April Fool’s Day…