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The king of oat milk Oatly (OTLY) has big plans on how it will spend the $1.43 billion or so it raised from a well-received IPO on Thursday.
Investors should expect an ambitious plan to expand manufacturing capacity to meet strong demand for Oatly oat milk, long-time CEO Toni Petersson said on Yahoo Finance Live.
"It's to build supply, to build out our production capacity across the three continents," Petersson said, referring to the use of its new capital infusion. Petersson — who has been CEO since 2012 — said Oatly has plans to build three new manufacturing sites up until 2023, including ones in Singapore and China.
The company currently has four facilities up and running, two of them in the United States. Its products are available in 60,000 retail locations and 32,200 coffee shops worldwide.
"This is a big year for us," Petersson said.
Oatly priced its initial public offering Wednesday night at $17 a share, which was at the high end of estimates. The stock opened at $22.12 on Thursday, giving it a valuation of nearly $13 billion.
Provided demand stays strong, the new manufacturing capacity should help Oatly reach profitability due to economies of scale.
The company's net loss hit $60.4 million in 2020, up sharply from $35.6 million a year earlier. Sales surged to $421.4 million from $204 million in 2019.
Says Petersson on current demand trends, "We see demand across the channels, and if you look at specialty coffee shops it's higher than pre-COVID [levels] now. It's still recovering, but still higher than pre-COVID."
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