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Oatly (OTLY) +1% as global demand for oat milk fuels Q2 sales
Oatly (OTLY) made gains in trading on the Nasdaq on Monday after its exclusive US partnership with Starbucks helped revenue to rise in Q2.
Swedish food company Oatly (OTLY) said that a “most transformational year” has put it on track to deliver a 64% increase in revenue as its exclusive partnership with Starbucks (SBUX) continues to pay off.
In an update on Monday, Oatly revealed that sales climbed to $146.2m during the three months to June before guiding for full-year revenues of $690m, which was $9m higher than Wall Street forecasts.
Central to that growth is a notable rise in production volumes, with Oatly’s oat milk currently in huge demand from both consumers and coffee chains seeking vegan-based products.
While the Malmö-based company was founded 30 years ago, it is currently riding the crest of a wave after a successful IPO in May that raised $1.4bn and valued the company at $10bn.
Chief executive Toni Petersson said that it had been a whirlwind 12 months with the recent float giving it the ability to “fuel new production capacity globally”.
Oatly revealed on Monday that it could double the production output at its manufacturing facility in Utah, after previously confirming plans for a new site in Texas by 2023.
It has also benefited from closer ties with major corporations including McDonald’s (MCD), KFC and Walmart (WMT) in China.
Perhaps most surprising is its exclusive agreement to provide oat milk to Starbucks in the US, a partnership that accounted for more than a quarter of all sales in Q2.
Petersson noted that its work with the coffee chain is “really important”, though the “magnitude of success” had been unexpected.
While it delivered a $0.09 loss in Q2, a cent better than the $0.10 expectations, investors appeared happy with the latest update.
Oatly shares jumped higher in early trading before easing slightly to +1% by around midday for a $17.02 price.
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