MFB - My Food Bag

[Stoploss]

Long Term Food Group and Robinsons own 23% of company .....are they behind this review?

Cecilia obviously is as she is on the Board.
I doubt LTFG are.
https://investors.myfoodbag.co.nz/Investor-Centre/?page=Board-of-Directors

[Basil]

I see a strong medium-term potential with My Food Bag.  I believe that isolation rules during Covid led to My Food Bag delivering artificially strong sales.  In 2023 and 2024 sales hit strong headwinds with higher interest rates and a weak economy.  Since then My Food Bag has worked hard to right size the business.  They have been doing well to show increasing profit in these difficult times.

However, I see a bright future.  Economic conditions should improve from 2026 onwards.  The business is scalable.  This would create favourable conditions and, I believe, lead to an acceleration of profits far above the $6.8 million forecast for FY 2026.  Additionally, as several readers point out, My Food Bag will be a cash rich company and able to pay significantly higher dividends.  My approximations could see them paying a dividend of over 3.5cents per year in two years.

I'm pleased with the review.  However, I believe the best value for shareholders is to wait for economic conditions to improve in a couple of years. 

Well said and I agree 100%.  They really have proved their business model is highly resilient in difficult economic times so why the review during the heightened geopolitical tension currently prevailing that's arguably having quite an effect on the muted economic recovery ?

[winner (n)]

29 cents .... then 30 cents plus

Then we'll be able to say 'we'll never see the 20's again'

[winner (n)]

WOW - MF*B in good company on the NZX Leaderboard this morning

MFB followed by CRAP and Truscreen and Warehouse

Enthusiasm contagious lol

[Basil]

29 cents .... then 30 cents plus

Then we'll be able to say 'we'll never see the 20's again'

   

[Left Field]

Seems a bit weird but a bit of ( Lambton Quay) chatter that the motivation for the "strategic review" was that they feel that they may have reached peak My Food Bag ...like maxed out and future growth hard to come by and now a good time to get a 'good price'

Well the "strategic review" worked well for FSF holders, so I hope it works well for MFB holders.

A few holders have topped up or purchased more on this news and I wish you well.

I posted a while ago that I thought the current business model for MFB was flawed and IMO the 'Strategic Review' endorses this thinking;  ( ie. NZ market too small, NZ market too constrained by entrenched opposition and meaningful NZ growth potential constrained etc,)   so it's good news that this review provides an opportunity for a MFB refresh.

And there are lot's of options for MFB

Takeover of MFB
Takeover by MFB
Merger of MFB with another
Privatisation
Capital Raise to make greater progress
etc etc

Call me crazy, but I'm happy to sit on the sidelines and wait to hear the outcome of the review. GLH's.

[Interested321]

I may be wrong but I understand that My Food Bag has barely increased their prices in the past few years.  This is despite the high levels of inflation (especially food price inflation).  My Food Bag has increased profitability by limiting costs.

This bodes well for the future as I'm sure that, given the increases in food prices, that customers would tolerate prices being increased in the near future.  The increase could be added to the bottom line.

[Pierre]

I may be wrong but I understand that My Food Bag has barely increased their prices in the past few years.  This is despite the high levels of inflation (especially food price inflation).  My Food Bag has increased profitability by limiting costs.

This bodes well for the future as I'm sure that, given the increases in food prices, that customers would tolerate prices being increased in the near future.  The increase could be added to the bottom line.

I'm not so sure about tolerating price increases - my wife is not convinced at all that their current pricing is good value.

Our sub has been on pause for a while and to reinstate it the cost
of a 3 meals per week pack for two of us is $120 i.e. $40 per night. She says that's far more than she would normally spend and is not interested in renewing.
A price increase would not be welcome at all.

[Basil]

Hey Pierre,

Another option is Bargain Box.  Regular price for 2 people, 3 meals a week works out to $14.83 per person per meal.  Can be as low as $6.95 per plate depending on numbers and frequency.  I suppose a lot comes down to how time poor people are and how much they value the convenience.  I'm guessing your wife has plenty of time to do the weekly shopping and choose the groceries she likes the most.

https://www.bargainbox.co.nz/?msclkid=39bcebcfeb15135d95e2823d6c363212&utm_source=bing&utm_medium=cpc&utm_campaign=BB%20-%20Brand%20-%20Exact%20Match%20-%20tROAS&utm_term=bargain%20box&utm_content=Brand%20-%20Head%20Terms&pr=BB50302010

[Pierre]

Hey Pierre,

Another option is Bargain Box.  Regular price for 2 people, 3 meals a week works out to $14.83 per person per meal.  Can be as low as $6.95 per plate depending on numbers and frequency.  I suppose a lot comes down to how time poor people are and how much they value the convenience.  I'm guessing your wife has plenty of time to do the weekly shopping.

Yep she does but doesn't like overpaying for food. I keep reminding her that HLG, TRA and others are supporting our lifestyle and we are very fortunate that we dont have to worry about cost, but old habits die hard!

[winner (n)]

Hey Pierre,

Another option is Bargain Box.  Regular price for 2 people, 3 meals a week works out to $14.83 per person per meal.  Can be as low as $6.95 per plate depending on numbers and frequency.  I suppose a lot comes down to how time poor people are and how much they value the convenience.  I'm guessing your wife has plenty of time to do the weekly shopping and choose the groceries she likes the most.

https://www.bargainbox.co.nz/?msclkid=39bcebcfeb15135d95e2823d6c363212&utm_source=bing&utm_medium=cpc&utm_campaign=BB%20-%20Brand%20-%20Exact%20Match%20-%20tROAS&utm_term=bargain%20box&utm_content=Brand%20-%20Head%20Terms&pr=BB50302010

Isnt the $6.95 the seductive promo price?

[Basil]

Isnt the $6.95 the seductive promo price?

No its not mate, that's their regular price for a larger family unit with 5 meals a week.  If you go on the website and select from the menu, 6 people, and 5 meals per week the regular price is $208.49 which for 30 plates of food = $6.95 per person per feed.  I reckon that's pretty good value.

[winner (n)]

No its not mate, that's their regular price for a larger family unit with 5 meals a week.  If you go on the website and select from the menu, 6 people, and 5 meals per week the regular price is $208.49 which for 30 plates of food = $6.95 per person per feed.  I reckon that's pretty good value.

Sorry —- what did you for dinner tonight?

[Basil]

Chicken drumsticks in the air fryer tonight mate. Tony has put his paw up for some too, minus the bones.  I need to get with the program and get some bargain box stuff eh.