MFB - My Food Bag

[Left Field]

A quick AI check of MFB customer numbers since listing:

FY21 (Post-Listing): 66,492 active customers
FY22: ~71,500 active customers (Company prospectus & prospective financial updates)
FY23: ~57,500 active customers
FY24: 56,800 active customers
FY25: 57,000 active customers
FY26: 57,100 active customers

.......the customer numbers tell the story.

Scary numbers indeed.

[Basil]

I couldn't disagree more.  Its quite clear that Covid and the fear of going out to do your own shopping gave them a massive tailwind for a short period of time which was never going to be repeatable other than in another Covid type era lockdown.  Also clear that MFB has done a fine job of building and holding its customer numbers during all the subsequent years of deep recession while contemporaneously driving down its costs through a roboticized warehouse with pick technology and almost complete repayment of all its debt building further resiliency into their business model.

The business has never been in better shape with no debt shortly, to look at new methods to grow the business when the economy starts to recover.
Clearly the market really likes the result and the excellent resilience the business has displayed despite the current geopolitical turmoil, even Blind Freddy can see that.  I'm happy with my numbers.

I'm up 60% in one year inclusive of dividends on a very low risk investment which is still trading on truly compelling metrics as well as being "in play" in a corporate sense. Additional to that is the forthcoming dividend in June.   

 

[Basil]

Dare I suggest that, following the recent LCD news, an investment next week in PEB at 27cps is likely to produce a dramatically higher capital gain  before year-end than an investment in MFB at a similar SP. Not investment advice, of course.

Early days of course but its interesting that despite the advice of provisional approval for PEB being common knowledge in the market for a full week this hasn't really been the transformational announcement some would have been hoping for with the shares languishing when I looked a few minutes ago at 25.5 cps, down 1.5 cents for the week to date whereas the market seems to approve of MFB's steady progress in lifting profitability with the share price up 3 cps or just over 10%.   These two of course have as much in common as a Tortoise and a Hare and all they have in common was the same share price last Friday. Just a good natured poke in the ribs back at you mate.  Of course its very early days and anything could happen by year end.

[lorraina]

In a couple or three months MFB will be debt free.Current number of shares on issue is 251,374,466.The business is profitable.
This means they will have the capacity to pay increasing dividends.
However PEB will most probably need another capital raise before they even break even.As for ever paying a divie.???Current number of shares on issue is 1,172,016,126 and goodness knows how many there will be before they break even.1.5 billion.?
Currently they remain unprofitable.

[Poet]

Early days of course but its interesting that despite the advice of provisional approval for PEB being common knowledge in the market for a full week this hasn't really been the transformational announcement some would have been hoping for with the shares languishing when I looked a few minutes ago at 25.5 cps, down 1.5 cents for the week to date whereas the market seems to approve of MFB's steady progress in lifting profitability with the share price up 3 cps or just over 10%.   These two of course have as much in common as a Tortoise and a Hare and all they have in common was the same share price last Friday. Just a good natured poke in the ribs back at you mate.  Of course its very early days and anything could happen by year end.

I do think the PEB cap raise is confusing the situation somewhat. Will be interesting to see where they are at in three weeks from now. They report fy result Monday

[Pierre]

Early days of course but its interesting that despite the advice of provisional approval for PEB being common knowledge in the market for a full week this hasn't really been the transformational announcement some would have been hoping for with the shares languishing when I looked a few minutes ago at 25.5 cps, down 1.5 cents for the week to date whereas the market seems to approve of MFB's steady progress in lifting profitability with the share price up 3 cps or just over 10%.   These two of course have as much in common as a Tortoise and a Hare and all they have in common was the same share price last Friday. Just a good natured poke in the ribs back at you mate.  Of course its very early days and anything could happen by year end.

Haha. I consider my ribs poked! But yes, I did say year-end, not week-end and plenty of water to flow under the bridge before we get to 31 December. It's a stupid competition but I still think you should save your MFB divvies to buy the drinks at the Viaduct next year.

[Interested321]

I agree with the comments from Basil.  I have been impressed with My Food Bag.  While the customer numbers have been flat over the last few years revenue has increased.  I think this has partially been the benefit of new offerings such as Christmas meals and gift packs.

However, the most impressive thing is that My Food Bag has consistently increased profitability in a flat economy in the past last two years.  They have done by reducing costs.  It has resulted in lowering debt markedly and first re-introducing and now increasing the dividend. 

The most important thing is the future.  I agree with Basil that My Food Bag could save another $900k in FY 27 due to reduced interest costs and the $400K non-recurring costs for establishment of My Food bag shop will not repeat.  This, and the complete clearing  of debt, should lead to a significantly increased dividend in FY27.  Furthermore, I predict that revenue NPAT will increase further as the economy (finally) improves – likely from 2027 onwards. 

The outlook is so strong I am wondering why a review is appropriate now.  I believe that the situation will have improved further in a couple of years and the value of My Food Bag will be significantly higher.  It may be best to wait and do the review then

[LoungeLizard]

I agree with the comments from Basil.  I have been impressed with My Food Bag.  While the customer numbers have been flat over the last few years revenue has increased.  I think this has partially been the benefit of new offerings such as Christmas meals and gift packs.

However, the most impressive thing is that My Food Bag has consistently increased profitability in a flat economy in the past last two years.  They have done by reducing costs.  It has resulted in lowering debt markedly and first re-introducing and now increasing the dividend. 

The most important thing is the future.  I agree with Basil that My Food Bag could save another $900k in FY 27 due to reduced interest costs and the $400K non-recurring costs for establishment of My Food bag shop will not repeat.  This, and the complete clearing  of debt, should lead to a significantly increased dividend in FY27.  Furthermore, I predict that revenue NPAT will increase further as the economy (finally) improves – likely from 2027 onwards. 

The outlook is so strong I am wondering why a review is appropriate now.  I believe that the situation will have improved further in a couple of years and the value of My Food Bag will be significantly higher.  It may be best to wait and do the review then

Revenue hasn't really increased:

FY22: $194.0 million
FY23: $175.7 million
FY24: $162.2 million
FY25: $162.1 million
FY26: $170.2 million

Sure, up 5% from last year but that was the lowest total revenue since listing. And it's 4 % lower than 3 years ago (post covid). As for net profit, same deal:

FY22: $20.0 million
FY23: $7.85 million
FY24: $6.04 million
FY25: $6.35 million
FY26: $6.70 million

The economy isn't going to improve anytime soon, in fact economists are saying that the real costs from the Iran war are yet to materialise and as oil/fertiliser reserves deplete prices will going up again as will inflation and possibly interest rates. So I can't see where the growth for a discretionary business with that track record is going to come from against this backdrop.

[winner (n)]

Suppose a reasonable sales trend since 2018

CAGR 1.7% ....but recent sales growth a bit more so that's good

Sort of supports what liard was saying

You cannot view this attachment.

1.7% pa revenue growth since 2018  ...... in real terms going backwards

The god ol RBNZ calculator says compound average rate has been 3.6% pa and there's been a 24.2% Change in purchasing

[Basil]

FLLYR: MFB: My Food Bag reports full year profitability up 5.3%

My Food Bag reports 6.2% growth in H2 with full year profitability up 5.3%
*Revenue of $170.2 million, up 5.0% on FY25 *EBITDA of $16.4 million, up
from $16.1 million in FY25 *NPAT of $6.7 million, up 5.3% on FY25 *Net debt
reduced by $5.1 million to $1.9 million and free cash flow of $8.5million
*FY26 H2 revenue growth of 6.2% year on year *Gross Margin stable at 49.0%
and above the 5-year average *Active customers at 57.1k with improved
lifetime value and retention *Fully imputed final dividend of 1.15 cents per
share declared, payable in June Meal kit and food solutions business My
Food Bag Group Limited today reported revenue of $170.2 million for the year
to 31 March 2026 (FY26), up 5.0% on FY25, with growth and profitability
accelerating in the second half. Net profit after tax (NPAT) increased to
$6.7 million, up 5.3%, reflecting strong operational delivery and improving
customer performance, including higher retention and increased order
frequency. Second half revenue rose 6.2% year-on-year, signalling a clear
lift in demand. Commenting on the result, CEO Mark Winter said: "FY26
marks a clear step forward. We are seeing the impact of the work we have done
to strengthen our proposition, with higher retention, increased order
frequency and more consistent customer engagement." "Our focus has been on
delivering a better overall experience and clear value for money, and that is
translating into customers ordering more often and staying with us longer."
Business highlights My Food Bag strengthened its core offering across the
year, delivering greater flexibility, convenience and value while driving
improved customer performance. Within our portfolio of brands, the My Food
Bag brand performed strongly, supported by continued investment in marketing
and customer engagement, reinforcing its position as a trusted choice for New
Zealand households. This is underpinned by a continued focus on quality, with
98% of fresh protein and produce sourced locally and a consistent emphasis on
delivering delicious meals customers enjoy week after week. The business
continued to improve the end-to-end customer experience, including the
ability to double protein, supporting higher engagement and increased basket
size. FY26 marked the first full year of expanding into new occasions via
the Shop, such as gifting, care packages and flexible one-off meals, all
available without a subscription, offering a convenient, fast-delivery option
and establishing an additional growth channel alongside My Food Bag's core
offering for consumers and corporate customers. Alongside this, My Food
Bag strengthened its focus on health, responding to growing demand for
solutions that support everyday wellbeing. This included introducing a range
designed to support customers using GLP-1 medications and building
partnerships with health professionals, reflecting a broader commitment to
helping New Zealanders eat well in a way that is both achievable and
sustainable. "We have continued to build strength in the My Food Bag brand
while broadening how customers can engage with us," said Winter. "Delivering
value for money alongside quality and variety is what is driving stronger
engagement and giving us confidence in how the business is tracking."
Financial performance Revenue growth was driven by higher volumes and
improved brand mix, supported by stronger customer retention and engagement.
Gross margins were maintained in line with historical levels despite higher
inflation with supply chain initiatives and pricing actions recovering
ingredient cost pressures. The business generated strong free cash flow of
$8.5 million supporting continued dividend payments and further reduction in
debt, with net debt reducing to $1.9 million. The Board is pleased to
declare a fully imputed final dividend of 1.15 cents per share, payable in
June. This brings the total dividend for FY26 to 1.90 cents per share (fully
imputed). The Board has decided that the Dividend Reinvestment Plan will not
operate in respect of the upcoming dividend. "The Board remains focused on
delivering sustainable returns for shareholders, supported by strong cash
flow and disciplined capital management," said Chair Tony Carter. Outlook
My Food Bag enters FY27 with positive momentum and is well positioned to
continue to support New Zealanders. The portfolio of brands, My Food Bag,
Bargain Box and Fresh Start, positions My Food Bag to meet customers across a
range of needs and price points, combining value, quality and variety, with a
growing focus on health-led solutions. "In the current environment, value
for money is critical, and that is where we are well positioned," said
Winter. "A consistent weekly price and a range of quality, healthy options
give customers certainty and real value, delivered to their door." Fuel
supply disruption has recently driven an increase in distribution costs, with
further ingredient cost pressures now beginning to emerge. Active mitigation
of these impacts through supply chain optimisation and cost control is being
undertaken where possible. Consistent with prior years we will take a
balanced approach to pricing. Early trading in FY27 has remained
encouraging, with demand trends continuing to track positively with revenue
growth of 5.1% for the first 7 weeks of the financial year, reflecting
continued sales growth from the execution of our plan and strength of our
customer base. My Food Bag announced strategic review As previously
announced, the Board has commenced a review to evaluate its ownership,
capital structure and strategic options. My Food Bag has engaged Cameron
Partners as its financial adviser, but the review remains in its preliminary
stages and there is no certainty that any transaction involving My Food Bag
will eventuate. My Food Bag will continue to keep shareholders and the market
updated in accordance with its continuous disclosure obligations.

Reads really well to me.  Amazing performance in the depths of a never ending recession.  Looks like it will produce in excess of $9m free cash flow from operations this year.  What will do with all that beautiful free flow cash ?  Share buy-back to turbocharge EPS growth ?

[winner (n)]

My Food Bag sales growth since 2018 been 1.7% pa (as posted earlier)

Hospitality sales have grown at 4.0% pa over same period (Stats NZ)

Maybe means something?

[LoungeLizard]

FLLYR: MFB: My Food Bag reports full year profitability up 5.3%

My Food Bag reports 6.2% growth in H2 with full year profitability up 5.3%
*Revenue of $170.2 million, up 5.0% on FY25 *EBITDA of $16.4 million, up
from $16.1 million in FY25 *NPAT of $6.7 million, up 5.3% on FY25 *Net debt
reduced by $5.1 million to $1.9 million and free cash flow of $8.5million
*FY26 H2 revenue growth of 6.2% year on year *Gross Margin stable at 49.0%
and above the 5-year average *Active customers at 57.1k with improved
lifetime value and retention *Fully imputed final dividend of 1.15 cents per
share declared, payable in June Meal kit and food solutions business My
Food Bag Group Limited today reported revenue of $170.2 million for the year
to 31 March 2026 (FY26), up 5.0% on FY25, with growth and profitability
accelerating in the second half. Net profit after tax (NPAT) increased to
$6.7 million, up 5.3%, reflecting strong operational delivery and improving
customer performance, including higher retention and increased order
frequency. Second half revenue rose 6.2% year-on-year, signalling a clear
lift in demand. Commenting on the result, CEO Mark Winter said: "FY26
marks a clear step forward. We are seeing the impact of the work we have done
to strengthen our proposition, with higher retention, increased order
frequency and more consistent customer engagement." "Our focus has been on
delivering a better overall experience and clear value for money, and that is
translating into customers ordering more often and staying with us longer."
Business highlights My Food Bag strengthened its core offering across the
year, delivering greater flexibility, convenience and value while driving
improved customer performance. Within our portfolio of brands, the My Food
Bag brand performed strongly, supported by continued investment in marketing
and customer engagement, reinforcing its position as a trusted choice for New
Zealand households. This is underpinned by a continued focus on quality, with
98% of fresh protein and produce sourced locally and a consistent emphasis on
delivering delicious meals customers enjoy week after week. The business
continued to improve the end-to-end customer experience, including the
ability to double protein, supporting higher engagement and increased basket
size. FY26 marked the first full year of expanding into new occasions via
the Shop, such as gifting, care packages and flexible one-off meals, all
available without a subscription, offering a convenient, fast-delivery option
and establishing an additional growth channel alongside My Food Bag's core
offering for consumers and corporate customers. Alongside this, My Food
Bag strengthened its focus on health, responding to growing demand for
solutions that support everyday wellbeing. This included introducing a range
designed to support customers using GLP-1 medications and building
partnerships with health professionals, reflecting a broader commitment to
helping New Zealanders eat well in a way that is both achievable and
sustainable. "We have continued to build strength in the My Food Bag brand
while broadening how customers can engage with us," said Winter. "Delivering
value for money alongside quality and variety is what is driving stronger
engagement and giving us confidence in how the business is tracking."
Financial performance Revenue growth was driven by higher volumes and
improved brand mix, supported by stronger customer retention and engagement.
Gross margins were maintained in line with historical levels despite higher
inflation with supply chain initiatives and pricing actions recovering
ingredient cost pressures. The business generated strong free cash flow of
$8.5 million supporting continued dividend payments and further reduction in
debt, with net debt reducing to $1.9 million. The Board is pleased to
declare a fully imputed final dividend of 1.15 cents per share, payable in
June. This brings the total dividend for FY26 to 1.90 cents per share (fully
imputed). The Board has decided that the Dividend Reinvestment Plan will not
operate in respect of the upcoming dividend. "The Board remains focused on
delivering sustainable returns for shareholders, supported by strong cash
flow and disciplined capital management," said Chair Tony Carter. Outlook
My Food Bag enters FY27 with positive momentum and is well positioned to
continue to support New Zealanders. The portfolio of brands, My Food Bag,
Bargain Box and Fresh Start, positions My Food Bag to meet customers across a
range of needs and price points, combining value, quality and variety, with a
growing focus on health-led solutions. "In the current environment, value
for money is critical, and that is where we are well positioned," said
Winter. "A consistent weekly price and a range of quality, healthy options
give customers certainty and real value, delivered to their door." Fuel
supply disruption has recently driven an increase in distribution costs, with
further ingredient cost pressures now beginning to emerge. Active mitigation
of these impacts through supply chain optimisation and cost control is being
undertaken where possible. Consistent with prior years we will take a
balanced approach to pricing. Early trading in FY27 has remained
encouraging, with demand trends continuing to track positively with revenue
growth of 5.1% for the first 7 weeks of the financial year, reflecting
continued sales growth from the execution of our plan and strength of our
customer base. My Food Bag announced strategic review As previously
announced, the Board has commenced a review to evaluate its ownership,
capital structure and strategic options. My Food Bag has engaged Cameron
Partners as its financial adviser, but the review remains in its preliminary
stages and there is no certainty that any transaction involving My Food Bag
will eventuate. My Food Bag will continue to keep shareholders and the market
updated in accordance with its continuous disclosure obligations.

Reads really well to me.  Amazing performance in the depths of a never ending recession.  Looks like it will produce in excess of $9m free cash flow from operations this year.  What will do with all that beautiful free flow cash ?  Share buy-back to turbocharge EPS growth ?

Of course it reads well, he's the CEO!

I remember Spark using its "free cash flow" to buy back shares which turned out badly for shareholders like me, as it seems that the business wasn't really growing in real terms ie smoke and mirrors. Sound familiar?

I think MFB's "strategic review" is a fishing trip to try and find a buyer for a business that is going nowhere, and more than likely will start going backwards. A takeover would be the best possible result for shareholders, before it hits the fan (again).

[Basil]

Well I wasn't going too, but since you brought up Spark (which by the way you said was compelling buying or words to that effect at $4.50), Spark have been paying excess dividends by cannibalizing their business, (selling off parts of it), and also heavily increasing debt over the years. 

MFB on the other hand have paid dividends well within the scope of their earnings per share and very comfortably indeed within their free cash flow per share and have done this while contemporaneously nearly paying their bank debt off entirely.

Its a K shaped economy LL.  Those with plenty of money, (probably the 3% Winner suggested), can afford the convenience of having their food pre-packaged and delivered and based on the very latest sales information from MFB they're continuing to do so despite heightened geopolitical tension and the rise in fuel costs.

Agree on one point with you.  The Cameron partners thing is a fishing expedition.  The thing with fishing expeditions is sometimes you can land a really good kingfish...ask me how I know