Join our daily newsletter At The Bell to receive exclusive market insights
- Australian dairy producer Jatenergy has highlighted funding needs for its recently announced initiatives
- In the last few months, JAT has ticked several milestones and is experiencing growth across its businesses
- Due to the significant increase in sales, JAT requires more funding to keep up with production and inventory
- As a result, company directors have started capital works of roughly $3 million
- Jatenergy is down 7.14 per cent, with shares trading for 5.2 cents each
Australian manufacturer Jatenergy has highlighted funding needs for its recently announced initiatives.
In the last few months, the consumer goods exporter has ticked some significant milestones and is experiencing business growth.
Jatenergy has seen a major increase in sales of its in-house dairy products which have been generated from existing relationships as well as new distributors, including Kigobaby and Kiss Kangaroo, who were signed on November 14.
The company also locked in a cosmetics joint venture last month called “JWR International” in Hong Kong. The JV will commence sales of CBD oil-based skincare for adults, pregnant women and children in early 2020.
This, in addition to the operations of plant-based meat products with Oppenheimer, is expected to be profitable.
While an increase in sales is highly positive for Jatenergy, it requires additional funding for the buildup of inventory and materials.
A big move for the company was its acquisition of 70 per cent (now 65 per cent) of Australian Natural Milk Association (ANMA). ANMA is a Melbourne-based dairy producer with approvals to export infant formula into the China market.
Yesterday, JAT announced a $1.8 million order from Beta A2 Australia Manufacturing, to be produced by ANMA.
When JAT first bought ANMA, it didn’t expect sales to reach what they have. As a result, company directors have commenced capital works with a total cost of roughly $3 million.
This funding will go towards the construction and expansion of its cleanroom facility and additional manufacturing equipment, which are expected to be in operation by February next year.
To better reflect its operations, a number of shareholders have urged the directors the change the company name from “Jatenergy” to “JAT Limited.”
Jatenergy is down 7.14 per cent, with shares trading for 5.2 cents each at 11:27 am AEDT.
