Organic Alliance Signs $2.35 Million Produce Supply Contract; Sees Several More Supply Contracts Ahead in Second Half '12
SALINAS, CA--(Marketwire -08/09/12)- Organic Alliance, Inc. (ORGC), a global grower and marketer of fresh, organic and Fair Trade fruits and vegetables, today announced it has signed a conventional produce supply contract -- with renewal options -- which it expects will generate $2.35 million in sales revenue.
This contract brings to $9.3 million the total value of new supply contracts announced by Organic Alliance in just the past 30 days, with several more in the pipeline expected to be signed this year.
The contract is with a central Mexico-based, family-owned greenhouse grower of conventional tomatoes and other produce with more than ten years of experience growing top quality produce for the U.S. market. All Organic Alliance greenhouse growers utilize advanced agricultural science to grow produce of exceptionally high quality, taste and texture within a safe and carefully controlled environment.
Under the contract terms, the grower will supply Organic Alliance with a specified weekly, year-round volume of on-the-vine, beefsteak and grape tomatoes (see photo). Harvesting, packing and shipping of these Organic Alliance branded bulk and retail packages are expected to begin with the October harvest and run for one year through September 2013. The name of this grower is not disclosed for competitive reasons.
Similar to the two previous supply contracts Organic Alliance announced last month, this contract contains renewal provisions that Organic Alliance believes offer strong potential to expand acreage, crop variety and volumes. Further, Organic Alliance elected to work closely with this grower for its qualification to become a strategic partner for Fair Trade development initiatives.
Growing, certifying, importing and marketing Fair Trade certified fruits and vegetables is a key component of the Company's 2013 business plan as just one catalyst to drive strong revenue and gross margin growth. Apart from the initial market leaders, chocolate, coffee and tea, Fair Trade foods remains a nascent, largely untapped market niche today, that is seeing extremely strong and rising demand from both grocery companies and consumers. Supply remains limited due to the numerous and complex certification requirements -- a process in which Organic Alliance has extensive experience.
"Organic Alliance is rapidly building a diversified, solid foundation of supply sources and revenue with major near and long term growth potential," said Parker Booth, Organic Alliance chief executive officer. "Every supply source we have contracted, and all those in our supply development pipeline, are selected for their strategic value to offer strong upside for wider crop variety and exponentially increasing crop volume.
"As we capture market share and our supply volumes grow, we believe the level of interest in Organic Alliance from the largest and fastest growing U.S. supermarket and specialty grocers will grow as well," Mr. Booth added.
About Organic Alliance
Organic Alliance, Inc. is a global grower and marketer of organic, Fair Trade and conventional fresh food products. By establishing collaborative relationships with key growers, the Company has built a vertically integrated supply chain through an alliance of growers that enables it to support its customers with an increasing variety of certified sustainable products, sensible pricing, steady supply and inspiring multi-media stories from our many producing communities. For more info, visit: www.organicallianceinc.com.
Safe Harbor Statement
This news release contains forward-looking statements which are based on current expectations, estimates and projections about our business based, in part, on assumptions made by our management. Actual results, levels of activity, performance or achievements could differ materially from those discussed or implied in the forward-looking statements as a result of various factors, including future economic, competitive, regulatory, and market conditions, future business decisions, changes in the supply and demand of the products we sell, our relationships with our existing suppliers, our success in finding additional supply sources, our ability to attract and retain customers, and the risks and other factors discussed in our Form 10-K for the year ending December 31, 2011 or in the other documents we file with the Securities and Exchange Commission. In light of the significant uncertainties inherent in such forward-looking statements, they should not be regarded as a representation that our objectives or plans will be achieved, and they should not be relied upon by investors when making an investment decision. Words such as "believes," "anticipates," "expects," "intends," "may," "forecasts, "foresees," and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. Similarly, statements in this release that describe our business strategy, outlook, objectives, plans, intentions or goals are forward-looking statements. We undertake no obligation to update or revise any forward-looking statements for events or circumstances after the date on which such statement is made except as required by law.
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