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Horizon Organic Holding Corp. (HCOW) |
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CEOCFO Current
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Horizon Organic is poised for growth in
the U.S. and the U.K. with a strong and extendable brand Horizon Organic Holdings Corp (NASD: HCOW)
markets the leading brand of certified organic foods in the U.S. and the leading brand of
organic milk in both the U.S. and U.K. In the U.S. its products include organic milk, a
full-line of organic dairy products, organic eggs and juices. In the U.K., the Company
markets organic yogurt, milk and butter under the Rachel's Organic brand. Horizon Organic
has a goal to produce the very best organic products and that starts on the farm. Their
cows are never treated with antibiotics or growth hormones and are fed a 100% certified
organic, vegetarian diet. Their daily regimen includes plenty of fresh air, access to
pasture, comfortable shelter and an endless clean water supply. Quality standards don't
stop at the farms. From purchasing organic ingredients for their products and feed for
their animals, to choosing earth-friendly packaging, the Company partners with the best
growers, suppliers and processors possible. Horizon Organic supports over 200,000 acres of
organic agriculture. “The organic food
industry has grown to be over eleven billion dollars in sales in the year 2002,” Mr.
Chuck Marcy, president and CEO of Horizon Organic tells us. “It has been growing in this country at a 22% compound annual growth
rate since 1996; that growth rate is projected by Datamonitor to continue at about the
same rate through 2007. The industry is growing very rapidly and in a recent study it was
found that 63% of consumers believe organic foods are healthier. As we make the products
more broadly available, consumers are trying them and integrating them into their diets.
The industry is growing very quickly and Horizon Organic is now America’s leading
organic food brand.” Asked about the importance of the Horizon Organic name, Mr. Marcy comments, “It is probably the
single most important asset of our company. When the company was formed, the founders
created not only a strong brand but an icon in our happy cow logo, that consumers view as
fun, upbeat, positive; kids love it and are very responsive to it. Despite the fact that
it is a cow, it is viewed by consumers as very appropriate even on products like our line
of 100% organic juices, and our line of organic eggs. We can build our distribution and
our existing product lines, and also extend into new product lines that may not include
dairy as an ingredient.” Horizon Organic is expanding their geographic
presence. “In the U.S., organic milk comprises on a
national basis about 2% of the milk business. There are pockets of significant strength
where organics started sooner and there is broader distribution; among those areas is the
San Francisco/Oakland market where organic milk is 10% of the milk business. Both the New
York and Denver market areas are about 6%, and Los Angeles is about 4%,”
states Mr. Marcy. “The good
news is that as we expand our distribution around the country, our business is growing
rapidly. Right now some of our fastest growing markets are in Texas, where our
business has doubled in all the major metropolitan markets in Texas in the last twelve
months. The business is stronger where we have been doing business longer, but it is
growing rapidly in the rest of the country as well. We think that the level of strength in
these other areas gives us an indication of what the future could be like in the next
three to five years, which would be a turn for our current stock.” Mr. Marcy
addresses potential investors, “We think the most
compelling reason to be interested in Horizon Organic, is that the brand is in-trend and
extendable. The organic food industry has been growing over 20% annually for the last five
years and this growth is projected to continue. Our brand is benefiting from that consumer
momentum at least as much as the market and will probably benefit more because of the
strength of the brand. Consumers have told us that we can take the brand anywhere in the
grocery, which means this business can be substantially larger. In addition,
throughout our recent growth, Horizon Organic has demonstrated the ability to perform on a
consistent basis in terms of delivering meaningful earnings growth.”
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