BranchOut Food Inc. Signs LOI and receives $250K PO from Leading Ingredient Distributor, Definitive Agreement Targeting $5-6M in 2025 Ingredient Sales

Rhea-AI Summary

BranchOut Food (NASDAQ: BOF) has signed a Letter of Intent with a leading dried food ingredient distributor, receiving an initial $250,000 purchase order. The company anticipates completing a Definitive Agreement in January with a minimum commitment of $5M in sales for 2025.

The company projects $4.0M in net revenue for Q1 2025, representing a 170% increase from the prior year, and expects to achieve positive cash flow in the same quarter. BranchOut's new Peru factory, with three fully operational production lines, offers the world's largest GentleDry™ capacity, positioning the company to compete in the $36 billion freeze-dry market.

Positive

• Secured $250,000 initial purchase order with leading ingredient distributor
• Projected Q1 2025 revenue of $4.0M, up 170% year-over-year
• Expected minimum sales commitment of $5M for 2025 through new distribution agreement
• Peru facility now fully operational with $40M annual production capacity
• Expected to achieve positive cash flow in Q1 2025

Negative

• None.

Insights

Financial Analyst

This LOI represents a significant revenue catalyst for BranchOut Food. The $250,000 initial PO and projected $5-6M in 2025 ingredient sales demonstrate strong commercial validation. The company's projection of $4.0M in Q1 2025 revenue, representing 170% YoY growth, coupled with expected positive cash flow, signals a potential inflection point in their financial trajectory.

The Peru facility's $40M annual production capacity provides substantial operational leverage. With three fully operational production lines and a strategic position to capitalize on potential Chinese import tariffs, BOF appears well-positioned to capture market share in the $36B freeze-dry market. The multi-channel strategy across branded retail, private label and now ingredients diversifies revenue streams while optimizing sales and marketing efficiency.

Market Research Analyst

The strategic positioning in the ingredient distribution channel is particularly noteworthy given the 7.6% CAGR in the freeze-dried market. The GentleDry™ technology offers a compelling competitive advantage through superior quality and cost efficiency. The exclusive supplier arrangement for multiple products strengthens BOF's market position and creates barriers to entry.

The expansion into major retail channels (largest retailer and warehouse club) alongside this ingredient distribution partnership creates a robust foundation for market penetration. The Peru facility's location and capacity provide strategic advantages in both cost structure and supply chain efficiency, particularly relevant given potential shifts in Chinese import dynamics.

Projecting $4.0M in net revenue for Q1 2025—up 170% from the prior year—and expects to achieve positive cash flow in the same quarter

Key Highlights:

• Signed LOI with leading ingredient distributor, establishing immediate sales volume in the ingredient channel.
• Received an initial $250,000 purchase order alongside the LOI.
• Anticipating completing a Definitive Agreement in January with a minimum commitment of $5M in sales for 2025.
• New Peru factory’s three production lines are now fully operational, offering the world’s largest GentleDry™ capacity and positioned to disrupt the $36 billion freeze-dry market¹.

BEND, Ore., Dec. 05, 2024 (GLOBE NEWSWIRE) -- BranchOut Food Inc. (NASDAQ: BOF), a pioneer in GentleDry™ dehydration technology, has signed a Letter of Intent (LOI) with a leading distributor in the dried food ingredient sector. This partnership marks a significant step in BranchOut's strategy to capture substantial growth in the ingredient channel, with anticipated sales of $5-6 million in 2025 and expected growth in the years ahead.

Along with the LOI, the ingredient distributor has issued an initial purchase order (PO) valued at approximately $250,000. This order is expected to set the stage for a definitive agreement in January 2025, following a planned visit to BranchOut’s state-of-the-art production facility in Peru. This agreement will establish BranchOut as the exclusive supplier for multiple products, capitalizing on its GentleDry™ technology and the cost and quality advantages of its Peru facility.

Anticipating a Transformative Year Ahead

BranchOut Food’s partnership with this seasoned leader in the dried food ingredient market marks a pivotal step in completing its three-channel sales strategy. Building on the rapid growth in branded and private label retail—already expanding into the nation’s largest retailer and the nation’s largest warehouse club—this agreement establishes a third sales channel in the ingredient market without requiring additional sales and marketing investment.

“This partnership accelerates our ability to capture growth in the ingredient channel while allowing us to focus resources on scaling our branded and private label retail channels,” said Eric Healy, CEO of BranchOut Food. “It reinforces our strong revenue trajectory heading into 2025.”

With its Peru facility now fully operational, boasting the world’s largest GentleDry™ capacity and supporting $40 million in annual production, BranchOut is positioned to scale efficiently and drive profitability. This collaboration showcases the disruptive power of GentleDry™ technology, which delivers superior quality, flavor, and nutrition, paving the way for sustained growth in the ingredient market and beyond.

Disrupting The Freeze-Dried Market

The freeze-dried market, valued at $36 billion and growing 7.6%¹ annually (CAGR), potentially faces rising prices from additional tariffs on Chinese imports into the US. BranchOut Food is set to disrupt the market with its GentleDry™ technology and Peru-based production, delivering superior-quality and lower costs.

“We believe our GentleDry™ technology is more efficient, cost-effective, and positioned to replace traditional freeze-drying,” said Eric Healy, CEO of BranchOut Food. “This deal will help launch our products into the ingredient channel, kicking off our disruption of the freeze-dried market with innovative and superior quality.”

About BranchOut Food Inc.

BranchOut Food is a leading international food technology company, specializing in the production of high-quality dehydrated fruit and vegetable-based products through its proprietary GentleDry Technology. This next-generation dehydration method preserves up to 95% of the original nutrition of fresh produce, offering superior quality and taste. Protected by over 17 patents, BranchOut’s technology enables it to stand out as a trusted brand, ingredient and a private-label supplier. For more information, visit www.branchoutfood.com or follow us on social media here.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts of future events. Forward-looking statements may be identified using words such as “forecast,” “intend,” “seek,” “target,” “anticipate,” “believe,” “expect,” “estimate,” “plan,” “position”, “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements with respect to the operations of BranchOut Food, Inc., (the Company) strategies, prospects and other aspects of the business of the Company are based on current expectations that are subject to known and unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from expectations expressed or implied by such forward-looking statements. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Although it may voluntarily do so from time to time, the Company undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

For more information:
info@branchoutfood.com

https://www.grandviewresearch.com/industry-analysis/freeze-dried-food-market-report¹

Investor Contact
PCG Advisory
Jeff Ramson
jramson@pcgadvisory.com

FAQ

What is the value of BranchOut Food's (BOF) initial purchase order from the new distributor?

BranchOut Food received an initial purchase order valued at $250,000 from the leading ingredient distributor.

What is BranchOut Food's (BOF) projected revenue for Q1 2025?

BranchOut Food projects $4.0M in net revenue for Q1 2025, representing a 170% increase from the prior year.

What is the minimum sales commitment expected in BranchOut Food's (BOF) definitive agreement for 2025?

The definitive agreement is expected to include a minimum commitment of $5M in sales for 2025.

What is the annual production capacity of BranchOut Food's (BOF) Peru facility?

BranchOut Food's Peru facility has an annual production capacity of $40 million.