BUY Recommendation today from Investors Chronicle4 Jun 2026 11:21
Shares down on lower 2026 sales guidance
Management still expects $15mn of sales in 2027
Customer engagement growing
Investors in MicroSalt (SALT:37p) were left with a bitter aftertaste last week, after the manufacturer of full-flavour low-sodium salt downgraded its full-year sales guidance from $7mn (£5.2mn) to $4.5mn.
Management did its best to polish the news, stating that the downgrade was driven solely by the timing of its 2027 product launch schedule rather than a shift in underlying demand or customer commitments. The reduced $4.5mn sales figure would still represent year-on-year growth of 118 per cent, while a $15mn sales forecast for 2027 was left unchanged.
However, the decision matters for a business that was confident of the figure as recently as January, having raised £1.7mn at a discounted 45p-a-share subscription and retail offer the previous month. Not only does the decision to keep the 2027 forecast suggest $2.5mn-worth of orders are no longer expected rather than delayed, but it raises doubts about the all-important runway to profitability in 2027.
At the risk of splitting hairs, guidance for 2027 was previously “more than $15mn” and “over $15mn”, implying directors are a little more cautious about that target too. And while triple-digit sales growth is always hard to model – especially when it involves the decisions and timelines of major fast-moving consumer goods customers – timing and credibility matter for a business that has raised £9mn over multiple rounds since early 2024.
Still, it’s not hard to see why many investors have stayed the course. MicroSalt’s patented and scalable manufacturing process, which produces a salt crystal 100 times smaller than traditional salt, allows for improved food adhesion and solubility without a change in taste.
Clearly, it’s proving a hit with Sabritas. In 2025, repeat purchase orders from the PepsiCo (US:PEP) subsidiary, which controls around four-fifths of Mexico’s snack market, amounted to 55 per cent of full-year sales. Further orders from PepsiCo’s Canadian and US business units underpin projections for North American volumes to reach $2.6mn this year and $8mn in 2027.
Beyond this key customer account, multiple “significant product placement opportunities” with a raft of national and multinational companies are reportedly at advanced stages. For those who can stomach the volatility, the medium-term opportunity remains compelling. Buy.
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