Pure Foods Tasmania Raises $100K as Directors Take Charge of Sales and Costs
Pure Foods Tasmania has raised $100,000 through a share placement and appointed directors to new operational roles aimed at driving sales growth and improving cost efficiency.
- Issued 5 million shares at $0.02 each with 5 million unquoted options
- Shares subject to 12-month voluntary escrow
- Directors Robert Knight and Ken Fleming take on sales and cost reduction roles without extra pay for 12 months
- Operating costs improved from 65% to 50% of revenue recently
- Company targets profitable growth despite expected lower revenue this year
Capital Raise and Share Placement
Pure Foods Tasmania Limited (ASX, PFT) has successfully raised $100,000 through the issuance of 5 million shares at $0.02 each, a price set approximately 26% above the recent 15-day volume weighted average price. Alongside these shares, the company issued 5 million unquoted options exercisable at $0.05 within two years. These shares will be under voluntary escrow for 12 months, reflecting a commitment to shareholder value stability.
Strategic Operational Reset
In a move to strengthen its operational platform, Pure Foods Tasmania has appointed two of its directors, Robert Knight and Ken Fleming, to additional roles focused on sales growth and cost management. Knight will lead sales and marketing efforts, aiming to revitalize export channels and expand ready-made meal offerings, while Fleming will concentrate on reducing manufacturing costs and improving supply chain efficiencies. Notably, both will forgo additional remuneration for at least 12 months, underscoring their commitment to the company’s turnaround.
Financial Performance and Outlook
The company has reported a significant improvement in operating costs, which have decreased from 65% to 50% of revenue over recent months. This improvement comes amid a strategic shift that includes the removal of loss-making product lines, resulting in lower overall revenue but higher gross margins. Pure Foods Tasmania is actively engaging with lenders to reduce debt and funding costs, aiming to achieve positive cash flow in the near term.
Brand and Market Focus
Pure Foods Tasmania continues to leverage its portfolio of premium Tasmanian brands, including Woodbridge Smokehouse, Tasmanian Pate, Daly Potato Co, and The Cashew Creamery. The company’s strategy emphasizes developing new products, expanding market penetration, and capitalizing on the growing plant-based food segment. The renewed focus on profitable growth is ambitious but grounded in achievable sales targets, reflecting a pragmatic approach to rebuilding momentum.
Leadership Perspective
Executive Chair Malcolm McAully highlighted the complementary skills of the directors stepping into their new roles and emphasized that operational repair, rather than immediate sales growth, remains the board’s priority. The capital raise is seen as a vote of confidence in the management team and the company’s improved performance trajectory.
Bottom Line?
Pure Foods Tasmania’s strategic reset and capital raise set the stage for a cautious but hopeful turnaround.
Questions in the middle?
- How will the new sales and marketing initiatives impact revenue growth in the next 12 months?
- What specific cost-saving measures will Ken Fleming implement to sustain margin improvements?
- How successful will the company be in negotiating debt reduction and lowering funding costs?
