Huy Fong is widely known as one of, if not, the best selling hot sauce in the world for its Sriracha chili sauce, but there is another rising star that is well-known in Asia and getting more popularity in the U.S. Exotic Food is that brand.
The company took advantage during the wake of Huy Fong supply shortage to expand the market in the U.S., especially in the last two years that Huy Fong’s Sriracha sauce was completely gone from the shelf due to weather conditions. That was what the California-based producer told the market, which is practically and partly the truth. The root of the cause is that Huy Fong failed to secure enough supply during bad weather conditions after it parted ways with its biggest supplier, Underwood Ranches.
As a result of its strategic planning and marketing, sales volume in the U.S. grew nearly 200% to 12,400 tons in 2023, while sales in Thailand and Europe rose 23% and 12%, respectively. This shows how much effort the company had put into expanding the U.S. market.
Sales growth in the fourth quarter of 2023 was better than anyone had participated. Late last year, the market expected to see only about 300-400 million baht in sales for the final quarter, while Mr. Jittiporn Jantrach, the CEO of Exotic Food himself, stated countless times that the figure will surprise everyone, hinting that it will be somewhat around 800 million baht. The actual report came on Tuesday that sales in the fourth quarter was slightly higher than what the CEO had said, which was 810 million baht.
Exotic Food recorded 2,521 million baht of sales in 2023, up 73% from the year before and 25% higher than expectation from analysts compiled by LSEG in December before revised their consensus for sales revenue up to 2,480 million baht earlier last month.
The company also recorded 130% net profit growth in 2023 with gross profit margin increasing from a little over 41% to nearly 47%. As a reward for its hard work in 2023, the share price of Exotic Food rose more than 8% in the following trading session after the earnings results.
Now it is up to the company whether it can maintain its customer base after Huy Fong is back in production, though not in full capacity. Moreover, there are some complaints that the taste of Huy Fong’s sauce is different from the one before the shortage.
The market share in the U.S. could be up for grab for any players who come out on top.