Rritual Superfoods’ next quarterly results could be hard to ignore
If you are a current investor or an interested party in Rritual Superfoods Inc. (CSE: RSF | OTCQB: RRSFF) then you have no right to say you don’t know what is going on with this company. I don’t think I’ve ever seen a company issue as many press releases over a 2 month period as Rritual. By my count, they have produced 17 press releases and one quarterly result since we last wrote about the Company on InvestorIntel on May 26th. The exciting thing is that most of these press releases are about sales and marketing milestones being achieved. Sure there is a couple of boring ones in there like Rritual Superfoods Inc. is pleased to announce that it will present at the Lytham Partners Summer 2021 Investor Conference, which is notable and may be of interest to some but not me. I’m a numbers guy, so news about May purchase orders and all the product launches and shipment deliveries is what I’m looking at.
As noted above, on May 28th Rritual released quarterly results for the nine months ending March 31, 2021. Unless you like reading the MD&A there isn’t much to review here primarily because the Company was still ramping up its production capability, building out the management team and lining up all the distribution opportunities for its products. Revenue of $721 for the quarter isn’t very telling of where Rritual is headed, and no I haven’t missed any zeroes on the end of that number. For example, March 30th was when it was announced that Rite Aid stores throughout the USA would be the first national retail rollout occurring in Q2 and Q3. So we’re going to have to wait until at least Q2 numbers or possibly Q3 to see results flow through to the bottom line.
In the meantime, we can look at what Rritual has been up to over the last two months to get a flavor for what those future results might look like. Don’t worry, I’m not going to discuss all 17 press releases but there are a few that have attracted my attention. For starters, on Jun 8th the Company stated that it had already surpassed its retail distribution targets for the end of 2021, exceeding 2,400 retail locations and 10,000 points of distribution. This has led to revised targets, based on the current lineup, to reach 6,000 stores and 20,000 points of distribution this year. That’s an impressive step change in yearend targeted distribution, and let’s not forget that there is also product development occurring to enhance and expand the existing product lineup.
Then there’s the May purchase orders announced on June 10th, which told us that the Company has received purchase orders totaling CAD $306,000 in the last week of May. May was effectively the first month of full-scale commercial operations so one can expect that this is a starting point and that as retail and distribution points expand the numbers could get pretty big. According to Rritual, based on the guidance of 6,000 stores and 20,000 points by year end, they expect to achieve a monthly run rate in the United States of CAD $1,300,000 achieving approximately 31-42% blended margins. By now you might be starting to get a feel for why I suggested ignoring the last quarterly results and its paltry $721 in revenue.
And now a little name dropping to really grab your attention – Amazon. On June 17th the Company announced the full line of Rritual products have passed the approval process for listing on the Company’s Amazon Store in the USA, planned for the end of June. Mr. David Kerbel, Rritual CEO is quoted as saying “Rritual’s multi-stage targeted launch is focused primarily on ‘being where the customers are,’ and no storefront in our world can help us more than Amazon to achieve that objective.” That news was followed up on June 25th that the full line of Rritual products have successfully been delivered to the Amazon Fulfillment Center and will be available to customers. I’m not sure if Amazon only counts as 1 distribution point or if it’s even included in the retail location count but this news in itself could be transformational for the Company.
These are what I consider to be highlights of the last two months but I’m not a retail expert by any stretch of the imagination. Other news includes the launching of its premium brand of functional superfoods in CVS Stores nationwide, and the latest product innovation plant-based collagen enhancers to Create “Beauty from Within” looking to replace animal based collagen enhancers. Maybe these are even more impactful than what I’ve identified. Regardless, the next two quarters look to be very exciting for Rritual Superfoods and the quarterly results could be hard to ignore going forward.
Disclosure: The author is long Rritual Superfoods Inc. (CSE: RSF).
Dean Bristow has been involved in the North American Crude Oil business for 30 years including Energy Trading, Infrastructure Development, Transportation, and Refining. During that ... <Read more about Dean Bristow>