ArcAroma AB: 210104 Breakthrough for ArcAroma in China, partner up with ZhongWu, market leader in China to explore the "Super Juice" market in China

Press release 2021-01-04

ArcAroma is pleased to announce that we have signed a strategic partnership agreement with ZhongWu on the joint development of the "Super Juice" market in China. Target to sell at least 40 CEPT® systems, with a Net Sales value of 140 MSEK in the coming 3 years. At the signing of the agreement, ZhongWu buys a juiceCEPT®plus for 3 MSEK.

ZhongWu is a Chinese company focused on the R&D and commercialization of sterilization technology and related processing equipment in various industries such as dairy, juice/beverages, food, drugs, etc. ZhongWu is an affiliate company of ZhongYa Group, a Chinese publicly listed company and the largest bottling & packaging solution provider in the dairy, beverage, juice, food oil, household chemicals, and other liquid products in China. ZhongWu & ZhongYa together provide turn-key solutions to over 300+ juice/beverage clients in China including major tier-1 brands such as NongFu Spring, Wahaha, Coca-Cola, Nestlé, COFCO, Danone, Yili, Cargill, Yihai Kerry, Arla, etc.

The partnership with ZhongWu targets the co-development of the significant potential of the Premium juice market in China. The first step is to jointly establish a "China Super Juice R&D Center", which aims to validate various types of Premium juices based on ArcAroma's juiceCEPT®plus system to obtain the local industry acceptance of the process and consumers qualifications. ZhongWu will immediately buy a juiceCEPT®plus Odin system after signing the partnership agreement. ArcAroma and ZhongWu target to sell at least 40 juiceCEPT®plus systems during next three years with a Net Sales value of 140 MSEK.  When ArcAroma Shanghai reach a sales volume of 100 CEPT® machines per year local production will be considered.

There is significant growth potential in the Premium juice market in China. As per the statistics by Frost & Sullivan, in 2019 the total juice market is 144 billion RMB in China, the Premium juice market is  around 7% share. However, the Premium juice market grows at 13% per year in average while the traditional juice at only 0.4%. As a reference the Premium juice market share in Japan is now 30% and that indicates the level that China might reach.

"We are glad to enter the partnership with ZhongWu for the Chinese Premium juice market, says Kevin Chen, Managing director of ArcAroma Shanghai. ZhongYa & ZhongWu is the solution provider behind major juice/beverage brands in China. Their strong local team with significant resources and connections with major brands will be a perfect match for ArcAroma. The partnership will not only provide ArcAroma an efficient marketentry to tier-1 juice brands in China, but also to other key markets such as food oil, dairy, health and household chemicals, etc."

"The partnership with ArcAroma will be important for our clients to accelerate the market launch of Premium juice products  for our clients, says Tina Yang, CEO of ZhongWu. We have been requested to find new solutions  for ESL(Extended shelf life) of Premium juices and we have identified the juiceCEPT®plus from ArcAroma as a perfect choice in various aspects. We look forward to jointly establish the "Super Juice" R&D center in China and scale up the Chinese Premium market together with ArcAroma."

"It is with great satisfaction that a collaboration with ZhongWu is now in place. Wiser with Kevin Cheng as leader has done a fantastic job to make this agreement. ZhongWu immediately shows that they believe in our concept by ordering initially one juiceCEPT®plus ODIN with an order value of 3 MSEK for immediate delivery. Now we have the best basis to establish juiceCEPT®plus & juiceCEPT® for ESL and improved extraction in the Chinese beverage market. ZhongWu with the parent company ZhongYa behind secure the conditions for accelerated growth. ZhongYa is in China said to be the equivalent to Tetra Pak. The goal is to sell around 100 juiceCEPT per year in China in 5 years. We will also establish the "Super Juice" concept in Asia with China as a platform" says Johan Möllerström, CEO of ArcAroma AB.

For more information, please contact:
Johan Möllerström, CEO
(+46) 768 - 86 81 78
Johan.mollerstrom@arcaroma.com

This information is such information that ArcAroma AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set above, at January 4, 2021 at 08.30 CET.

About ArcAroma AB (publ)
ArcAroma has developed a patented technology that controls and applies electrical pulses to optimize various biological processes. The CEPT® platform, which is a high-voltage generator combined with a treatment chamber, uses the technology within FoodTech for increased extraction from the raw material and extended shelf-life and increased quality of the final product. Within CleanTech, the CEPT® platform is used for sewage sludge treatment and biogas production. The platform uses short-term high-voltage pulses (PEF) that crush the cell membrane and eliminate unwanted microorganisms.
Our vision is to contribute to a sustainable world by offering efficient green cutting-edge technology that is easy to use in the areas of FoodTech and CleanTech.

ArcAroma's shares are listed on NASDAQ First North Premier Growth Market. Erik Penser Bank is Certified Adviser and is available at 08-463 80 00 or certifiedadviser@penser.se.  www.arcaroma.com

\Hugin