Fountain Fresh opens soft drink syrup blending, packaging plant.

SALT LAKE CITY--(BUSINESS WIRE)--Jan. 27, 1995--Fountain Fresh International (NASDAQ EBB:FNTF), developers and marketers of unique self-serve, in-store soft drink and pure drinking water dispensers, Friday announced start up of its own syrup blending and packaging plant to supply supermarkets and other retail stores that install the Fountain Fresh Beverage Center(TM) dispensers.

Otto Cutts, president and chief executive officer, said the new facility will save the company $4.00 to $6.00 per 20-liter case, most of which will go directly to increased profit.

In addition, the company already has 17 outside customers for its services, which are expected to generate regular monthly revenues of at least $175,000, Cutts projected.

Because there is no similar facility for handling syrups, juices and mixers in the region, the company anticipates double-digit growth in this external business over the next several years.

The two Fountain Fresh dispensers deliver either 24 or 12 flavors of ice-cold, carbonated soft drinks directly to customers in one and two-liter bottles, plus pure drinking water, processed within the system, into gallon jugs, all at the lowest prices in the store. The customer then refills his bottles over and over at even lower prices.

The company owns more than 30 proprietary syrup formulations and sells all these syrups to supply their dispensers, but the blending and packaging have heretofore been performed by others under contract. The company also collects a royalty on every gallon of water flowing through the dispensers delivered as pure drinking water.

"Having our own syrup plant gives us direct control of our primary ingredient cost and puts us on equal footing with our major beverage company competitors," Cutts said. "We're now in an excellent position to increase both our market share and our profitability."

Cutts said the company intends to build similar syrup plants in any region where local syrup prices are excessive and where other customer business can supplement the company's own requirements. Such regional operations would not only reduce shipping costs substantially but also facilitate production of syrups, juices and mixers especially suited to local tastes.

He added that Fountain Fresh envisions 30 to 40 such "micro" syrup production centers serving local areas in the United States, plus additional plants abroad. The company already has its Beverage Centers operating in Canada, Australia and The Philippines, and negotiations are currently underway with beverage and investment interests in nearly a dozen other countries.

CONTACT: Molesworth Associates, Green Valley, Ariz.

Gordon Molesworth, 602/625-0035