Research (Ray’s Lemonade) online would suggest Peak in fact contract manufactures for more distributors than we are informed of.
The processing plant at Peak has the capacity to produce 10,000 cases of product or 240,000 cans per 40 hr work week. It seems to me this contract is a manufacturing contract where in the normal course of business Tweed Inc would provide the product packaging and Peak would provide the mix and produce the end product.
This part of the business would not be a substantial burden on the cash flow of the manufacturer, strict payment terms given costs include labour hour and if the manufacturing process is managed carefully (minimise downtime when changing product type eg making sure a run is for maximum production of a product type) can create a greater margin for Peak.
Seems AGH through Peak is on a positive path, cost management must remain a prime focus for the group.
AGH Price at posting:
4.8¢ Sentiment: None Disclosure: Held
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