Fruitas to Innovate, Seize Opportunities as More Stores Reopen
In the face of a challenging year, leading food and beverage kiosk operator Fruitas Holdings Inc. (FHI, PSE: FRUIT) intends to adapt and seize attractive opportunities in the market. Fruitas has not been spared by the once-in-a-lifetime calamity caused by COVID-19, but has quickly acted to build on the strides it had made since its IPO and has continued to deliver fresh concepts to satisfy client demand.
The year began with the eruption of Taal Volcano, which affected operations in Calabarzon. Upon the imposition of quarantine due to COVID-19, some store operations and supply of certain raw materials were disrupted.
Despite these, Fruitas remains committed to its expansion. In early February, Fruitas acquired two new food brands: The Tofu Store and Filipino cuisine operator Kuxina. Recognizing the potential for increased delivery services, even prior to the quarantine, Fruitas acquired CocoDelivery, which has expanded to carry not only coconut water, but virtually all Fruitas product lines from its Jamaican Patties to Sabroso Lechon. At the same time, it developed its grilled chicken offering, PORTO’S Peri-Peri Chicken.
Fruitas is planning to open up to 10 Babot’s Farm outlets, its new fresh products store concept, by August 2020. Fruitas has opened the first Babot’s Farm outlet along E. Rodriguez Sr. Avenue, Quezon City. Babot’s Farm will initially have three major verticals of fresh products in its portfolio, including FRUIT’s leading buko beverage line, Soy & Bean fresh soy products line (soy milk, tofu, and taho), and fresh dairy and yogurt from Bukidnon Milk Company. Other Fruitas products like frozen De Original Jamaican Pattie, ready-to-heat SHOU Chinese delicacies and viands from Sabroso Lechon and other Fruitas food brands will also be made available in Babot’s Farm outlets in due course. Babot’s Farm’s outlets will also function as CocoDelivery hubs.
Since the quarantine began in March, the company has been in talks for more tie-ups and looking into more strategic acquisitions. Fruitas joined with food retailer Pan de Manila in April and placed its fresh juice products in Pan de Manila stores. It also partnered with Bukidnon Milk Company to carry its fresh dairy yogurt.
First quarter 2020 operating results were impressive with net profit increasing 41 percent over 2019. Not only did the company experience good sales growth, but cost control measures without sacrificing its strong employee work force increased net margins. Second quarter 2020 results under strict Community Quarantine will not be as favorable. At the start of the quarantine, as few as 40 stores were operating. Now, more than 575 are back in business and are seeing increasing sales as the economy gradually reopens.
FHI President and Chief Executive Officer Lester Yu is expecting a faster recovery as the year progresses especially in light of the initiatives being undertaken.
“This year has been difficult for all of us and sometimes with a lot of hardship for our customers and employees. As a company, our complaints are nothing in comparison to the suffering of millions of fellow Filipinos. We have an obligation to them as well as to our shareholders to not only survive but to thrive and prosper. We will make a bright future for our company,” he said.
