Bubs Australia has reported a strong quarter-on-quarter turn around in what founder and CEO Kristy Carr said are still challenging market conditions.
Snapshot:
- Group quarterly gross revenue $12.Bm, up +36% over Q1 FY21 (QoQ), down -12% on prior year (pep).
- China cross border e-commerce (CBEC) sales up +27% QoQ and up +34 % pep.
- Adult goat dairy gross revenue up +45% QoQ and up +25% pep.
- Bubs infant nutrition portfolio represents 57% of Q2 revenue, with sales up +27% on Q1 FY21.
- Bubs Australia is the fastest growing infant formula manufacturer across Woolworths, Coles and Chemist Warehouse with combined retail scan sales at the checkout up +41 % QoQ and up +6 7% pep.
- Bubs Goat Formula has the fastest growing brand share across the total category, up +46% QoQ.
- Strong consumer offtake sales volume for Bubs during Double 11 on Tmall Global, up +17 4 % pep.
- Bubs consumer offtake sales increased +163% pep across top-tier CBEC platforms in China.
- CapriLac ranked No.1 goat milk brand on Tmall Global during Double 11 and for duration of Q2.
- Corporate daigou trade is softer than pre-COVID levels, but up +122% on Q1 FY21.
- Export sales to markets outside of China continue to strengthen, up 194% QoQ and up +138% pep.
- Robust balance sheet with $40.2 million in cash reserves.
Carr said: "Whilst the impact of COVID-19 continues to cause channel disruption and market conditions remain challenging, we are pleased to report sales growth is returning across all product groups, channels and regions, with quarter-on-quarter gross revenue increasing 36 percent.
"While this is still some 12 percent below the prior comparable period due to the contraction of the daigou channel, we are particularly pleased by the strong rebound in domestic sales which are up 31 percent quarter-on-quarter. Total export sales revenue was also up 45 percent on previous quarter, and up 55 percent on prior year, validating our global expansion strategy is taking hold.
"Bubs Infant Formula has enjoyed a material uplift in Australian retail sales quarter-on-quarter with independent retail scan sales data confirming Bubs Australia is the fastest growing infant formula manufacturer across Woolworths, Coles and Chemist Warehouse; up 41 percent quarter-on-quarter, and up 67 percent compared to the prior corresponding period. Bubs is now the leading goat infant formula brand in Chemist Warehouse."
There was continued strong demand in China, with Q2 FY21 China CBEC sales revenue increasing 35 per cent year on year.
Carr said they were pleased with the turnaround progress in the corporate diagou channel, with outbound domestic sales through the reseller channel more than doubling - up 122 per cent quarter-on-quarter.
“While we remain confident in the long-term viability of the channel, the challenging COVID-19 environment and the near absence of Chinese visitors and students in Australia is likely to continue to constrain the domestic daigou channel growth in the short term,” Carr said.
Chair Dennis Lin said while a degree of uncertainty still exists, the quarter-on-quarter turnaround in sales momentum was significant and a positive indicator for the long term.
“Global expansion remains a key focus with continued export sales momentum throughout the quarter. We anticipate revenue contribution from South East Asia will substantially increase with our recent launch in Malaysia building on existing business in Vietnam, Hong Kong, Macau and Singapore,” Lin said.
