GLG Life Tech Corp. (Nasdaq:GLGL; TSX:GLG) announced April 19 that it has shipped six million bottles of tea, sweetened with stevia, to 157 distributors throughout China.
The news comes a few weeks after the company’s disappointing March 31 earnings report.
The use of stevia as a sweetener is controversial in North America, where it is banned.
GLG swung from a $488,000 profit in 2009’s fourth quarter to a $3.2 million loss in 2010’s fourth quarter.
Costs soared, but the company projected $160 million to $200 million in 2011 revenue. That’s up substantially from the $58.9 million in sales that it generated in 2010.
Almost all of GLG’s operations, and hundreds of staff, are based in China, even though the company has its head office in Vancouver.
GLG’s current campaign of delivering stevia-sweetened teas branded AN0C is part of a joint venture, of which GLG owns 80% and China and Healthy Foods Co. Ltd. holds 20%. The campaign’s first phase runs from the end of March until April 30.
Business in Vancouver has been following GLG since it announced in 2008 that it had signed an agreement to supply US$200 million worth of the controversial artificial sweetener to Cargill Inc.
Cargill, which is one of the world’s largest private companies, then had 158,000 employees in 66 countries. (See “Sweet deal sends GLG Life Tech stock soaring” – issue 967; May 6-12, 2008.)
Both Health Canada and the U.S. Food and Drug Administration have banned the use of stevia as a food additive because they fear that the herb is toxic. A major study 24 years ago showed that stevia could cause liver mutations in rats.
Others shrug off that study and highlight the fact that it is natural and has zero calories. It is widely used in Japan.
GLG executives believe that they can make sales inroads thanks to China’s plan to tackle a sugar shortage.
The Chinese government also wants to address the health concern that its citizens eat too much sugar.