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Fruitas Moving Out of the Box Amid COVID-19 Headwinds

Fruitas Holdings Inc. (FHI, PSE: FRUIT) traces its beginnings from a difficult environment, yet overcame huge obstacles to become the leading food and beverage kiosk operator in the Philippines, and intends to repeat the feat to scale even greater heights emerging from COVID-19 pandemic.

FHI opened its first store – “Fruitas Fresh from Babot’s Farm” – in February 2002 at SM City Manila. The world was still reeling from the September 2001 terrorist attack in New York City and the Philippines was still recovering from the presidential impeachment trial a year earlier. The Philippine Stock Exchange index was trading at 1,400, on the way down to a low of 985. However, by 2019, FHI already generated Php1.95 billion in annual revenues with over twenty unique brands sold through more than 1,000 locations.

“We have long-term confidence in the Philippine economy and like the Filipino in adversity, we will remain focused on building a better future,” said FHI President and Chief Executive Officer Lester Yu.

Fruitas had previously announced its intention to expand its free-standing community stores under the Babot’s Farm and Soy & Bean brands to sell additional product lines and serve as hubs for its CocoDelivery subsidiary. To that end, the company has identified and is in the process of securing 25 locations targeted to be opened by the end of the year. The end-September target of ten new stores is almost completed.




Further, the company is aggressively expanding its product line through agreements with existing companies that may lead to more synergies in the future. Fruitas has entered an agreement to carry Carmen’s Best Ice Cream, the Philippines’ most premium locally made ice cream, in selected locations.

In addition, Fruitas has entered into a supply arrangement for Jim’s Recipe sponge cake originally from Malaysia and to have a Soy & Bean house brand of hopia delicacies produced by one of the oldest Chinese bakeries in Manila. A new production facility for Soy & Bean soy products is ready to come on line.

In the coming months, Babot’s Farm will expand its product lines to include Fruitas branded nut products, coffee beans, and cacao beans. The company hopes to soon finalize an agreement with a baker-supplier for export-quality ensaymada and other bread items. With these additional products, Fruitas believes it will also be able to maximize its vast network of more than 1,000 low-capex, small-footprint stores which no other local foodservice firm currently possess.

“The public trusted us with their investment money through our Initial Public Offering and we continue to aggressively look for opportunities. However, we will continue to be disciplined as both the retail and food business has changed, requiring new ideas,” concluded Yu.



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