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PURECIRCLE LTD
("PureCircle" or the "Company")
QUARTERLY STEVIA MARKET UPDATE
PureCircle (LSE: PURE), the world's leading supplier and marketer of high purity stevia products, provides an update on the global high purity stevia market covering the quarter to 30 September 2011.
US and Global Consumption Estimates
· Based on Nielsen USA consumer retail sales for the quarter to 30 September 2011 and internal PureCircle data, the Company estimates annualized USA consumer usage of 260 tonnes high purity stevia. This represents a +52% increase from the annualized consumption for the quarter to 30 September 2010.
· In the US, the high purity industrial sales volumes translate to consumer retail consumption of an estimated $1.34bn in annualized Food and Beverage products sweetened with stevia. This compares to $995m of annualized consumer retail sales in the quarter to 30 September 2010.
· Analysis of the ingredient usage by non-table top food and beverage companies indicates that PureCircle is direct or indirect supplier to 87% of the products by volume and 84% by value.
· As a result, estimated annual global consumer usage, including retailer store and distributor inventory, is approximately 400 tonnes in Reb A sweetness equivalent volume. Note that this volume is currently driven primarily by the United States, Mexico, France and Australia. It does not yet include the newly opened European market or significant development of the carbonated soft drink market.
· PureCircle internal data further indicates that market adoption of ingredients has quickly diversified beyond only Reb A. PureCircle's SG 95 is experiencing increasingly greater brand adoption in new launches and reformulations. Further, PureCircle's flavors, NSF-01, and NSF-02, have already been adopted by several leading $1bn+ brands.
The global market analysis of current high purity stevia consumption is based on estimates derived from current Nielsen and internal PureCircle data from the US market and extrapolated to the global market, for the quarter ending 30 September 2011. The analysis captures historical market development and is not a forecast of future market growth. Note that all figures are captured in "Reb A Sweetness equivalents" to standardize reporting measures. Though, significant development is noted below in the growth of PureCircle's new sweetener and flavor ingredients, including SG 95 and NSF-02.
Market Drivers of Growth
· The market is experiencing growth across all key categories. Assessing data from categories that saw launches at least one year ago, it is clear that there is strong repeat purchase and growth in usage. Examples from US Nielsen data include:
o Juices: The category has reached nearly $270m in estimated annualized sales, up +25% over the prior quarter and +87% on the quarter to 30 September 2010, largely driven by growth of Trop50 and new launches.
o Flavored Waters: The category has reached $580m in estimated annualized sales, up $30m over the prior quarter to 30 June 2011, driven by strong growth in Sobe Lifewater and Vitamin Water Zero.
o RTD Tea: The category has grown to $35m in estimated annualized sales, up +65% over the prior quarter, driven by the growth of Lipton 100% Natural.
o Sugar Substitutes: The US table top market annualized retail sales are +45% over the quarter to 30 June 2010, reaching $97m.
· Globally, there is a broadening of category usage, with new launches seen within the last quarter in the following categories: Flavored Water, Fruit Flavored Drinks, RTD Tea, Alcoholic beverages, Juice, Yogurt, Powdered Drink Mix, Baked Goods, Energy Drinks, Smoothies, Cereal Bars, and niche Carbonated Soft Drinks.
· According to Datamonitor, 300+ products sweetened with high purity stevia launched in the US and 630 around the world in the 12 months to 30 September 2011. Note that these launches have been primarily driven by markets including the United States, Mexico, France and Australia.
Regulatory Approvals
· The EU Commission has given regulatory approval for the use of steviol glycosides as a sweetener in foods and beverages in the European Union. The regulation permitting the sale and use of steviol glycosides has now been published in the Official Journal of the European Union as of November 12th and came into force, allowing for sale of products formulated with steviol glycosides as of December 2nd. This approval opens a new market for stevia in which annual sweetener consumption is equal to over 125,000 tonnes of high purity stevia.
Consumer Developments
Recent studies in France, the UK, and Spain indicate the following key developments:
· France: Consumer aided stevia awareness has now reached 47% across the general population (July 2011), up from 23% one year earlier (July 2011).
· UK: Awareness of stevia is low but among those aware, stevia is viewed positively relative to other sweetening options.
· Spain: Stevia compares favorably to sugar on key ingredient attributes including being good for a healthy lifestyle.
Commenting on the stevia market update, Magomet Malsogav, CEO PureCircle Limited said "The sustained growth of the stevia market speaks to its mainstream potential and success in delivering naturally lower calorie solutions that consumers demand. PureCircle continues to drive this growth with new innovative solutions. We anticipate continued market growth to come with the opening of new markets, and launch of larger brands and supported by the introductions of new innovative stevia ingredients from PureCircle, such as PureCircle Alpha and Natural Flavor NSF-02." |
