Marley Readies Recyclable RealCup Plans To Sell OCS Operation In Push To Become Profitable

DENVER, CO -- Marley Coffee said it will launch its recyclable RealCup single-serve capsule on July 29 in partnership with Canadian roaster Mother Parker's Tea & Coffee. The eco-friendly capsule, like the original RealCup, will be compatible with most Keurig K-Cup machines.

"There is currently a serious garbage crisis and as the waste stream continues to grow, so will the pressures on our landfills, our resources and our environment," said Marley Coffee chairman and founder Rohan Marley. "We believe our recyclable cup is a significant step forward in solving the 11 billion coffee capsule crisis [the estimated number of capsules consumed worldwide last year]."

Marley Coffee said it will promote "eco-friendly" RealCup capsules through multicity tasting and demonstration tours, dedicating six weeks to each market. The events will be supported by public relations and social media promotions.

For the first quarter, ended April 30, Marley Coffee said its overall sales increased 27.9% ($2.74 million) over last year's comparable quarter, while gross profits rose by 76%. Net losses were reportedly down 37.4%, compared with the same period a year earlier. The company said it anticipates that it will become profitable by the fourth quarter of the current fiscal year.

"We're continuing to work to grow the top line of our business while also trying to reduce our overhead," said Marley Coffee chief executive Brent Toevs. "We've got some new initiatives this quarter that should help streamline our operating costs even further."

Part of its plan is to sell the office coffee service operation, which it acquired in August 2013 from Denver-based Black Rock Beverage, to another OCS company in the region. Marley Coffee said it expects to close the deal within the second quarter.

When Marley Coffee purchased the OCS route, it said it was part of a larger national strategy that the company planned to initially roll out in its hometown. | READ MORE

Focused on growth opportunities, the company said retailers have committed to additional shelf space with the launch of its recyclable RealCup. Another bright spot is international distribution, which it said continues to grow especially in Canada and Chile. Sales to South Korea reportedly climbed from zero this time last year, to $295,759.

Marley Coffee is also pushing its new "My Cup" series, which are small-batch, single-origin, limited release specialty coffees available exclusively on the company's online store as part of its recurring subscription or as a one-time product purchase.

"The company's primary goal is to continue to grow, but to get to profitability on a quarter-by-quarter basis by the end of the current fiscal year," the company said. "This would move us into a completely different category, which potentially will allow us to refinance our lines of credit into bank debt and obtain more favorable terms for future funding. We are currently talking to local banks to prepare the company for this anticipated milestone."