MINNEAPOLIS — Oat-based beverages are driving double-digit sales growth for SunOpta, Inc.’s plant-based business. Company executives expect the recent acquisitions of a soy-based beverage brand and a rice-based beverage brand to accelerate that growth.

SunOpta’s plant-based business posted sales of $119.5 million in the first quarter ended April 3, which was up 12% from $106.2 million in the previous year’s first quarter and up 47% from $81.3 million in the first quarter of 2019. Higher demand for oat-based product offerings and increased retail sales volume of other plant-based beverages drove growth.

Demand in the oat milk alternative category is increasing by triple-digit percentages with four or five brands procuring the vast majority of market share, said Joseph D. Ennen, chief executive officer of SunOpta, in a May 12 earnings call.

“We partner with several of those leading brands as they are going to market with oat milk offerings,” he said. “So we feel like from a demand standpoint, we are in a really good position in terms of who our brand partners are.

“As it relates to capacity, we were incredibly fortuitous with the investment that we made in 2019 around oat milk. We are seeing really strong business development and utilization from both existing and new customers around our oat milk production. At this juncture, we still have available capacity. We still have the ability to take on new customers.”

SunOpta in April announced the acquisitions of Dream and WestSoy plant-based beverage brands from The Hain Celestial Group, Inc. for $33 million. SunOpta already produced the entire WestSoy product portfolio and 50% of the Dream product portfolio. Dream is 90% rice milk, and WestSoy is 100% soy milk, Mr. Ennen said.

“Our forecast is that these brands next year in 2022 will add $15 million to $20 million of incremental revenue and $6 million to $8 million of incremental EBITDA when we complete the in-sourcing of all volumes,” he said. “Our current priorities with Dream and WestSoy are to realize the in-sourcing synergies, transition the business and build the capabilities needed to manage these brands.”

He added SunOpta executives have talked about expanding beyond plant-based milk alternatives and that Dream gives the company that option.

Companywide, Minneapolis-based SunOpta recorded revenues of $207.6 million, which were flat when compared to the previous year’s first quarter. The fruit-based business generated revenues of $88.2 million, down 13% compared to $101.4 million in the previous year’s first quarter. Fruit-based revenues fell because of planned stock-keeping unit (SKU) and customer rationalization. Supply constraints for certain fruit varieties, which limited blended frozen fruit offerings, had a negative impact as well.

SunOpta’s earnings from continuing operations of $1.7 million compared with a loss from continuing operations of $4 million in the previous year’s first quarter. A $281,000 earnings loss attributable to common shareholders compared to net earnings of $1.3 million, or 2¢ per share on the common stock, in the previous year’s first quarter. Adjusted EBITDA of $18.3 million compared with $13.7 million in the previous year’s first quarter.

“The first quarter played out largely as expected, with plant-based revenues continuing to grow rapidly, margins improving in fruit-based and very strong double-digit growth in adjusted EBITDA,” Mr. Ennen said.