Business Description:
Clover Corporation Limited (CLV) is involved in the refining and sale of natural oils, production of microencapsulated powders and the research and product development of functional food and infant nutrition ingredients. CLV operates from three sites: Company headquarters in Sydney; a manufacturing plant for tuna oils and related products in Victoria; and a product development R&D facility in Brisbane.

Strategy Analysis:
Clover reported a net profit after tax of $1.24m for the year ended 30 June 2004. The improvement was due to the increased sales of Omega3 oils and microencapsulated Powders. Sales were slower in the UK and the European division due to the inability of Martek to supply Arasco oil; the key ingredient to Omega3 DHA enriched infant formula. Management said sales would return to normal after September 2004. Clover has declared a maiden dividend 1 cps, 38% franked. Clover's focus is to take advantage of the trend towards healthier eating and the growing market for nutritional supplements. Part of CLV’s strategy is to increase awareness of Omega3 fatty acids in diets and expand technology in the field of functional food and infant nutrition. Growing low cost competitive products has led to Clover focus on refining its product lines and looking for alternative less costly sources of Omega3, whilst ensuring a high level of quality. Nu-mega is looking at expanding into the US. The company has appointed a development manager to capitalise on the growing awareness of Omega DHA products. 6 multinationals have commenced trials using Clover’s Omega 3 DHA. CLV has collaborated with Austgrains International to make soy a natural food additive. The joint venture has commenced construction of a manufacturing plant in Moree. Marketing has also commenced aiming to have potential customers ready to take product early in the 2005.