Canyon Creek Food Company Ltd.
TSX VENTURE : CYF

November 09, 2015 08:00 ET

Canyon Creek Provides Business Update

- Company licensed by CFIA, TCO, and for shipping to the United States

- Current production capacity at $35 million of sales

EDMONTON, ALBERTA--(Marketwired - Nov. 9, 2015) - November 09, 2015 - Canyon Creek Food Company Ltd., ("Canyon Creek" or "the Company") (TSX VENTURE:CYF), is a North American food processor, focused on the preparation, sale and distribution of high quality, natural, preservative-free, fresh soups, and other food products. These products are sold to grocery retailers and a broad range of food service establishments. The Company is pleased to provide this detailed update on its recent activities, which has set the stage for accelerated revenue and earnings growth in the months ahead.

Background

Canyon Creek was founded in 1996 in Edmonton, Alberta, as a producer of fresh refrigerated foods. Two years ago, it redefined its business model and customer base, and in the process, re-invented the Company's marketing and distribution direction. After 18 months of laying groundwork, that effort is now generating positive momentum.

The Company has invested heavily in its 21,000 square foot plant, which houses an aggregate 2,125 gallons of production capacity for soup and other products across six kettles; a 500 gallon pasta cooker; high-speed cup and polybag fillers; a 10,000 litre cold water chilling system; refrigerated shipping and receiving coolers, and a frozen storage room. Maximum plant output at full production would have a current wholesale value, (depending on the product mix), of approximately $35 million per year.

To make this possible, and following a multi-year effort, to date, Canyon Creek has been awarded the following certifications:

  • Federally certified production facility by CFIA (Canadian Food Inspection Agency);
  • Registered protein processing facility by CFIA;
  • Registered fisheries processing facility by CFIA;
  • Registered protein processing facility by USDA, allowing shipment into the U.S.; and,
  • Organic certification by TransCanada Organic (TCO).

Together, these represent a substantial barrier to entry, one that would likely require a new industry entrant several years to acquire, at considerable cost.

Management

Terry Alty, President and CEO of Canyon Creek, is a food processing and marketing professional with 32 years' experience. Prior to joining Canyon Creek, he was employed for almost 20 years' by Pillsbury Canada, then a national division of a global food processor. Over time, he worked his way up to become Director of Sales for Western Canada.

Recent Developments

Over the past year, the Company's market penetration efforts have successfully resulted in a number of new placements, including the following:

  • Two products under the CYF label, have been placed in 94 big box stores, across all ten provinces, in a retail chain almost universally known to Canadian consumers;
  • Two products under a co-packed label have been placed in 38 big box retail stores in Western Canada;
  • Nine different soups have been placed in 110 retail stores across Western Canada; and
  • The Company has successfully entered the hospital food services market, supplying Canyon Creek fresh processed foods to thousands of in-hospital patients in Western Canada.

The Market

Fresh prepared foods are a rapidly growing segment of the food industry in the U.S., with a $26 billion market, and expectations of growth of 6-7% per year to 2017. A clear majority of consumers across all demographics, are now willing to pay more for healthier foods. Today's consumers want fresh healthy food products, and that puts Canyon Creek in the right space to leverage off of this shift in dietary preferences.

Fresh refrigerated soups and other fresh products are expected to outpace other categories in the processed food industry. It is the Company's intention to continue to build product platforms on soups, entrees, side dishes and potato based products such as mashed potatoes, sweet potatoes, potato salad and seasoned potatoes. Canyon Creek's products are packaged with the customers' convenience in mind, with a guaranteed 90 day preservative free shelf life.

The Company's primary geographic focus over the next two to three years is Canada and the Western U.S. Over time, Canyon Creek intends to leverage its existing relationships to expand into a broader array of big box chains, and increasingly in the U.S. market.

ABOUT CANYON CREEK

Canyon Creek is a food processing company based in Edmonton, Alberta, providing fresh soups and other prepared food products for today's health conscious consumer. The Company offers its fresh food product line to both grocery retailers and a broad range of food service establishments including restaurant chains and public institutions.

This news release contains forward-looking statements which involve known and unknown risks, delays, and uncertainties not under the Company's control which may cause actual results, performance or achievements of the Company to be materially different from the results, performance or expectations implied by these forward-looking statements.

The TSX Venture Exchange has neither approved nor disapproved of the contents of this press release.

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