MODESTO, Calif., Aug. 22, 2011 /PRNewswire/ -- Paleteria La Michoacana (PLM) announced today a record first half of the year in sales and profitability. The Modesto based manufacturer of Hispanic-oriented ice cream and frozen novelties recorded stronger than expected growth across its customer base in the U.S. and abroad despite the cooler weather experienced in the first half of the year.
The growth has been in part attributable to launching new product varieties with healthier ingredients. Leading the way are the Company's new Agave fruit ice popsicles. The Agave plant, primarily from Mexico, produces several pounds of edible flowers during its final season. The stalks are roasted to provide a sweet extract called aguamiel, which is similar to sugarcane but without the negative health effects.
According to Ignacio Gutierrez, President of PLM, "Agave pops provide all the enjoyment of water ice popsicles in various flavors but are friendlier to people looking for great-tasting sugar-free options." The product has been introduced through all the major California grocers and many convenience stores. "We are looking at new flavors and ideas around the Agave product line to complement our core frozen novelty product line," said Gutierrez. Another growth driver has been the company's ability to expand the number of distributors nationwide, which is expected to remain a core component of PLM's future success. According to Patricia Gutierrez, PLM's Executive Vice President, "We have great distributors that have helped introduce our product throughout California, the Pacific Northwest, the Intermountain West region and the Midwest. Their local market knowledge has allowed us to be one of the fastest growing ice cream brands, and in most cases the leading Hispanic ice cream brand, with leading retailers in what amount to new geographic markets for PLM." The recent release of IRI Nielsen data in California for the first 24 weeks of 2011 further validates the company's claim that La Indita Michoacana ® frozen novelties are among the fastest growing ice cream brands in California supermarkets.
In 2009 and 2010, the company made substantial investments to expand its operating platform to accommodate anticipated rapid growth. According to Ignacio Gutierrez, "We really expanded our production facility and logistics capabilities by building an 18,000 sq. foot freezer, expanding our DSD fleet to over 50 trucks, revamping our manufacturing lines and opening depots in new markets. This big investment is really paying off in 2011 and has really prepared us for the opportunities ahead of us."
The company's solid financial structure has been a key element in its growth as well. According to Jose Blanco, Partner at The Central Valley Fund (CVF) based in Davis, CA, "The Company's three banking relationships and CVF's recent $3.5M equity investment into the company have allowed the Company to deploy over $10M into its plant and equipment. This group also equips the Company with substantial capital resources to grow its business in the future. Nacho and Patty have done a great job as pioneers in the fast growing Hispanic-oriented frozen novelty segment and have some great opportunities ahead of them. My partners and I could not be more excited to be a partner with the Company. Blanco emphasized, "A capital allocation decision of this magnitude on the collective part of an investment fund and commercial lenders speaks to confidence in PLM's management and support for the company's historical and expected future performance."
About Paleteria La Michoacana
Paleteria La Michoacana founded in 1991 in Turlock, CA, is a leading producer, marketer and distributor of premium ice cream and other fine desserts. The Company is known for its fine quality and methods used to produce its paletas, using natural fruits and ingredients of the highest quality. These bars come in traditional, Hispanic-oriented flavors, including Coconut, Arroz con Leche (Rice Pudding), Guava, Walnut and Cookies n' Cream. For more information, please visit http://www.ytupaleta.com or contact Patricia Gutierrez at 209-321-0079.
About Central Valley Fund
The Central Valley Fund was established by the principals of Gael Partners, LLC to finance later stage growth through mezzanine and preferred equity investments. The fund has offices in Davis, CA and Fresno, CA. It is focused on making investments in California's Central Valley and throughout the state. For more information, please visit http://www.centralvalleyfund.com or contact Jose Blanco at 530-757-7004 ext. 227.
SOURCE Paleteria La Michoacana