Mr. Vince Timpano reports

LASSONDE INDUSTRIES INC. ANNOUNCES AN IMPORTANT CAPITAL INVESTMENT PROGRAM IN THE UNITED STATES

Lassonde Industries Inc. has planned an important capital investment program aimed at enhancing the competitiveness of its U.S. beverage manufacturing network.

The program mainly consists in the investment of approximately $200-million over an estimated two-year period for the construction of a new beverage manufacturing facility in New Jersey on a site adjacent to the corporation's existing plant. Once built, the state-of-the-art facility, extending across approximately 200,000 square feet, will replace the existing plant and enable Lassonde to fortify its competitive position in the key U.S. northeast market by improving operating efficiency and delivering incremental volume at lower costs through a more efficient production flow, improved yields and better logistics. The investment is expected to be accretive with an internal rate of return that exceeds the corporation's cost of capital.

Construction is expected to begin in early 2025 and existing production activities will be progressively transferred beginning in 2026. The transition is expected to be completed in 2027, reaching a full run rate by the end of that year.

"Lassonde is proud to launch an important investment program to strengthen its position as one of the leading North American fruit juice and drink manufacturers," said Vince Timpano, chief executive officer of Lassonde Industries. "Since entering the U.S. market, we have methodically expanded our footprint and our initiatives will support further expansion of both our private label and branded beverage activities while improving our profitability. Over the longer term, this investment program will offer the potential to add further production capacity and new capabilities to meet market opportunities.

"Investments will drive efficiency enhancements across our U.S. operations while providing flexibility and added capabilities to meet future growth in demand," Mr. Timpano added. "Our U.S. volume build-back plan is progressing as anticipated, and this new facility will offer more capacity over the longer term to better serve our customers and support our momentum. Through Project Eagle, which identified and addressed key issues impacting the U.S. beverage supply chain and manufacturing performance, and the commissioning of a new single-serve line in North Carolina, our teams have proven their ability to execute large and complex projects, and we are confident in their ability to deliver this significant one on time and on budget."

"The support we have received from Upper Deerfield Township and Cumberland County in New Jersey has been instrumental in making this new facility a reality," added Amanda Burns, president, private label, Lassonde Pappas and Company Inc. "For several decades, our U.S. business has called Cumberland county home and this investment further underscores our long-standing commitment to the community and our belief in its continued growth and prosperity."

Following the recent $53-million (U.S.) investment to expand its single-serve capabilities in North Carolina, Lassonde also plans to invest an additional $20-million (U.S.) at this facility to fortify its role as a strategic production hub. This supplementary investment consists in bringing in-house certain owned production assets currently deployed at a co-packer facility. This in-sourcing, expected to be completed in 2025, will allow the corporation to enhance network efficiency and reliability by optimizing the utilization of these assets, while providing more flexibility to meet incremental demand.

Related to the New Jersey project, certain existing assets will have to be depreciated at an accelerated rate over a period of 10 quarters beginning in the fourth quarter of 2024. As a result, the corporation expects its quarterly depreciation expense to increase by approximately $1.5-million (U.S.) during that period.

About Lassonde Industries Inc.

Lassonde is a leader in the food and beverages industry in North America. The corporation develops, manufactures and markets a wide range of private label and national brand products, including ready-to-drink beverages, fruit-based snacks as well as frozen juice concentrates. It is also a leading producer of cranberry sauces and specialty food products such as pasta sauces, barbecue sauces, condiments, soups, and fondue broths and sauces. The corporation also produces, imports and markets selected wines from several countries of origin and produces and markets apple cider and cider-based drinks.

The corporation is active in two market segments:

• Retail sales consist of sales to food retailers and wholesalers such as supermarket chains, independent grocers, superstores, warehouse clubs and major pharmacy chains.
• Food service sales consist of sales to restaurants, hotels, hospitals, schools, and wholesalers serving these institutions.

The corporation operates 19 plants located in Canada and the United States and produces its superior-quality products through the expertise of over 2,900 full-time equivalent employees.

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