Bubs Australia has reported a record quarterly revenue of $19.7 million for the third quarter ended 31 March, with a significant increase in demand across all channels and direct sales to China more than doubling.
The recent quarterly revenue is up 67 per cent on the previous corresponding period, with the company’s year-to-date revenue sitting at $48.5 million. It is already ahead of its FY19 full-year revenue which was $46.8 million.
Bubs’ Australian market represented 64 per cent of gross sales for the quarter and its China market was up 104 per cent pcp, representing 24 per cent of gross sales.
“While fully satisfying domestic demand, export revenue has also increased as we ship product by sea container to our strategic partners, including Alibaba for online sales into China through its Centralised International Procurement initiative, and the Beingmate Joint Venture,” said Bubs Australia founder and CEO Kristy Carr.
“In addition to doubling direct sales into China, we have experienced growth across all channels and key partners. In particular, there has been strong demand from Vietnam during the quarter with frequent replenishment expected into April and beyond.”
Bubs is also reviewing its marketing strategy, including launch date for new products, said Carr, which “included the strategic decision to prioritise production of Bubs Goat Milk Infant Formula range in the last quarter, resulting in a delay of the CapriLac refresh by approximately four weeks to the end of March, which affected performance of Adult Goat Dairy during the period”.
Bubs executive chairman Dennis Lin said it was important for the Bubs portfolio to be recognised as an essential service that is critical to the wellbeing of those who rely on infant formula as the source of nutrition for their newborn and infant needs. Bubs has revamped its online store to “ensure continuity of supply to Australian families who may have difficulties accessing their regular stores”.
“We remain agile and able to quickly respond to this fast-moving situation, with operating flexibility from our vertical supply chain and strong balance sheet position,” said Lin.
“Our expanded production teams are now running two eight hour shifts daily to meet domestic demand, as well as committing to volume container shipping of product to Asia to meet increased export demand.”
“None of this would have been possible without the efforts of our team, and we are particularly grateful to our Australian farmers who supply quality milk, and all the other suppliers such as Bega Cheese who contribute to the end product.”
As at 31 March, Bubs Australia has $36.4 million in cash reserves and a positive operating cash flow of $2.3 million.
