SAN DIEGO, Dec. 18, 2017 (GLOBE NEWSWIRE) — ProGreen US, Inc. (ProGreen), (OTCQB:PGUS), www.ProGreenUS.com, Twitter @ProGreenUS, www.CieloMarBaja.com announces the following:
On Friday, December 8, 2017, ProGreen announced the agreement for the supply of chili peppers to Huy Fong Foods in California for 2018. ProGreen Farms US, LLC is committed to a minimum delivery of chili peppers representing $1,200,000. However, as the demand is virtually unlimited, ProGreen Farms US, LLC is setting new goals of considerably higher sales for 2018 and 2019.
We believe we can reach $5,000,000 in sales for ProGreen Farms US, LLC in 2018. It is important to note that the expansion will be dependent on obtaining financing to fund the considerable investment needed, though we believe that we are now in a much better position for financing than ever before.
With clearing and preparation of more land within the existing Arenoso Farm, we expect to produce closer to $2,500,000 in farming revenues for the coming year.
We also have an opportunity to acquire land adjacent to the Arenoso farm, which would increase the total area from 300 to 1,050 acres. However, any new farming land will be acquired by Procon Baja JV, with farmable tracts leased to Contel. This will result in the asset being held by ProGreen’s subsidiary, enabling it to be rolled over to the company’s balance sheet.
We see the opportunity to incorporate a further 125 acres for farming in 2018 from this additional land. If acquired, it will require drilling of more wells to obtain the necessary water needed for further irrigation.
With this expansion, revenues are expected to reach closer to $5,000,000 in 2018, with a 50% further increase possible for 2019.
In addition for these expansion plans, we would also build our own packing plant at Arenoso, to pack the chilis directly at the farm, to be loaded on trucks for direct delivery to Huy Fong in California. This would save costs and simplify the logistics connected with such an expansion.
“Setting our goal to become the No. 1 supplier to Huy Fong, will no doubt demand very fast expansion to get ahead of the competition, but we do have the advantage of access to good land in a virgin farm area,” says Jan Telander, CEO of ProGreen.
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