Bubs Australia reported a $9.4 million group gross revenue for Q1FY21, down 34 per cent pcp, but managed to increase sales in its Australian grocery and pharmacy retailers by 29 per cent pcp.
Direct sales of its goat formula products to China also increased by 76 per cent compared to the same period prior year, however, group performance was “considerably impacted by the sharp downturn in the domestic daigou channel,” Bubs founder and CEO Kristy Carr said.
“To address the significant disruption to the daigou channel, caused by the sudden border closures and increased international freight costs, we are also working alongside our corporate daigou partners to continue to actively support social marketing with their daigou customers via live-streaming and social e-commerce,” she said.
“We have already started to see positive sales momentum return in late September through to October, and we anticipate improved performance from the daigou channel in the second quarter as we lead into China’s major e-commerce shopping events.”
“Given the dynamic channel mix in our traditionally daigou driven Adult Goat Milk powder business, we have commenced development of new Adult Goat Milk functional products under our CapriLac brand suitable for the general trade channel, thereby doubling the addressable market size.”
Domestic gross revenue of $6.1m accounted for 65 per cent of group quarterly revenue with Bubs retail scan sales “over indexing against the category”, while direct export gross sales in China represented $2.6 million, 27 per cent of group quarterly revenue.
Since launching Bubs Organic Grass-fed Formula in 700 Woolworths stores in Australia, it has achieved an 18 per cent market share of the organic formula category.
“Throughout the quarter, we have continued to demonstrate our agility in response to evolving market dynamics and have growth strategies in place to leverage our unique value proposition as we embark on our five-year growth pathway across multiple regions throughout Asia and the Americas with our current portfolio, as well as entry into adjacent high margin categories where we have the supply chain security and expertise to innovate,” said Carr.
Bubs Australia will host its Annual General Meeting virtually and is scheduled for 23 November.
