Oragin – the parent company of Toronto grocery chain Organic Garage and plant-based cheese manufacturer The Future of Cheese – reported a 17.3% slide in sales for the second quarter.
Sales fell from $6.8 million to $5.7 million as the company posted a net loss of $789,768 for the quarter, compared to $383,130 the previous year.
Compared to the previous year, gross profits were down from $2.25 million to $1.69 million.
Store wages and benefits decreased by 7.9% due to “management of staffing and improved efficiencies.”
Oragin attributed the net loss to its decision to complete significant renovations to one of its older Organic Garage retail locations, offset by decreases in store wages and benefits and cost-savings related to its phase-out of warehouse operations.
There are currently four Organic Garage locations in the Greater Toronto Area.
“We continue to focus on and prioritize our operational goals for both the short- and long-term as well as strategies to increase in-store sales, including enhanced and targeted advertising and promotion. The renovations impacted our second quarter sales and results; however, we expect that the short-term negative impacts will be offset by the long-term expectations for the location,” Matt Lurie, CEO of Organic Garage, said in a statement.
“Management acknowledges that there are continuing challenges facing the business regarding in-store sales, distribution, and the labour market, and are working diligently to ensure that we are navigating the economic environment with strategic purpose.”
Lurie also announced that Oragin’s Future of Cheese business obtained Organic Certification through Ecocert in May, which will allow the company to market organic claims on its products in Canada, the U.S. and Europe.
“Looking forward through the third and fourth quarters, we are focusing on fiscal improvements for the associated areas of our operations that faced non-recurring expenses last year, a recovery of in-store sales, and improved gross margin. We continue to remain excited and optimistic for the go-forward path of Oragin Foods and both of our divisions continue to show opportunity for growth,” Lurie stated.