Mr. Joe Ennen reports

SUNOPTA ANNOUNCES THIRD QUARTER FISCAL 2023 FINANCIAL RESULTS

SunOpta Inc. has released financial results for the third quarter ended Sept. 30, 2023.

All amounts are expressed in U.S. dollars, and results are reported in accordance with U.S. generally accepted accounting principles, except where specifically noted.

Third quarter 2023 highlights:

• Revenues of $152.5-million increased 5.9 per cent compared with $144.0-million in the year-earlier period, driven by 5.5-per-cent volume growth.
• Gross profit margin was 13.3 per cent on a reported basis. Excluding start-up costs, gross margin was 16.4 per cent, down 140 basis points from 17.8 per cent mainly due to the 150-basis-point increase in depreciation related to new production equipment.
• Loss from continuing operations was $5.7-million compared with earnings of $2.4-million in the prior-year period.
• Adjusted earnings from continuing operations attributable to common shareholders were $500,000 or nil per diluted common share, compared with adjusted earnings of $2.4-million or two cents per diluted common share in the prior-year period.
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) from continuing operations was $19.1-million, or 12.5 per cent of revenues, compared with $17.7-million and 12.3 per cent of revenues in the prior-year period.

"We delivered strong volume-driven revenue growth in the third quarter from protein shakes, oat milk and snacks," said Joe Ennen, SunOpta chief executive officer. "In addition, the divestiture of our frozen fruit operations subsequent to the end of the quarter was a major strategic milestone that significantly optimizes our product portfolio for growth and profitability, along with helping to reduce debt and strengthen our balance sheet, which creates opportunities for capital allocation beneficial to shareholders, including the potential adoption of a share repurchase program. Key growth initiatives continue to advance, including market share gains with existing customers, new customers and total addressable market expansion. We are also in the process of replacing our existing asset-based lending arrangement, supplemented with third party extended payable facilities and finance leases, with a term loan and revolver structure with limited finance leases, which we expect will be in place by the end of the year. With our strong foundation, leverageable platform and expanding capacity, we are confident in our direction and believe that we remain well positioned to deliver significant long-term sustainable growth and value for shareholders."

2023 outlook

For fiscal 2023, the company maintains its outlook, adjusting for the divestiture of Frozen Fruit.

2024 outlook

For fiscal 2024, the company expects strong revenue growth, driven by volume and strong adjusted EBITDA growth.

Conference call

SunOpta plans to host a conference call at 5:30 p.m. Eastern Time on Wednesday, Nov. 8, 2023, to discuss the third quarter financial results. After opening remarks, there will be a question-and-answer period. Investors interested in listening to the live webcast can click a link on SunOpta's website under the investor relations section. A replay of the webcast will be archived and will be available for approximately 90 days on the company's website. This call will be available with the toll-free dial-in number 888-440-4182 or international dial-in number 646-960-0653 using conference ID 8338433.

About SunOpta Inc.

SunOpta (Nasdaq: STKL) (Toronto Stock Exchange: SOY) is a United States-based global pioneer fuelling the future of sustainable, plant-based food and beverages. Founded nearly 50 years ago, SunOpta manufactures natural, organic and specialty products sold through retail and foodservice channels. SunOpta operates as a manufacturer for leading natural and private label brands and also proudly produces its own brands, including Sown, Dream and West Life.

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