MyEco Group Ltd (ASX:MCO) Reports Strong Q2 FY25 Sales Growth
Sales Performance Summary
MyEco Group Ltd (ASX: MCO) reported a total of $4.1 million in sales for sustainable products in Q2 FY25, representing a significant increase of 32.0% compared to the prior corresponding period. This marks an impressive 10.6% growth quarter on quarter, boosted by robust increases in MyEco branded and council and waste management sales.
Record Sales in MyEco Products
The company achieved record sales of $1.6 million in MyEco branded products, up 155.8% year-on-year and 75.2% quarter-on-quarter. The uptick was driven by strong sales in the MyEcoWorld product line in the USA, which saw sales soar by 295.9% quarter on quarter. Additionally, the successful launch of compostable carry-bags into 80 Ritchies stores contributed to positive momentum, with $0.6 million in advanced orders secured for Q3 FY25.
Council and Waste Management Growth
Sales for council and waste management services reached $1.3 million, marking a 55.1% increase from the prior corresponding period and a 50.3% rise quarter on quarter. The company expanded its reach from 52 to 56 councils in Australia over the past six months, reinforcing its operational footprint and anticipating further growth in the second half of FY25.
Challenges in Sustainable Resin and Film Sales
Sustainable resin sales declined by 41.5% compared to the prior corresponding period, challenged by volatile market conditions in LATAM. As a result, MyEco Group plans to focus its resin production on supporting its own MyEco products. Sustainable film sales also saw a drop of 9.2% year-on-year and 34.0% quarter-on-quarter, though developing new compostable wrapping films is ongoing.
Future Outlook
MyEco Group expects overall group sales to grow in the second half of FY25, bolstered by record MyEco branded sales and anticipated sales increase to local councils as food scrap diversion programs gain traction. The company aims to leverage its successful brand to manage increased demand through strategic partnerships, enhancing growth and operational efficiency.
Motley Fool contributor Lauren Surplice has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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